General Considerations on the Economic Policy of the Central Government and the Intervention of the Local Authorities and Their Specialized Finance Institutions Therein

Abstract

Fluctuations in economic activity have long intrigued economists and politicians. Many theorists have endeavoured to arrive at the why’s and wherefore’s behind the alternation of periods of prosperity and recession, growth and stagnation, full employment and unemployment, and thereby to find the causes of the cyclical pattern apparent in economic activity. The answers were sought in natural phenomena, climatic influences, regulatory measures by the authorities, the formation of concentrations of economic power, the extent of the creation of money and the provision of credit, wage levels, size and nature of investments, the volume of consumer expenditure and in psychological factors, among other things. The regular and seemingly automatic manner in which the economic tide rose and fell, as brought to the fore with the development of improved statistical methods, was a factor of considerable influence on economic thinking in this respect.