The increased government spending noted in Q.3.1. above has to be financed in one way or another. Describe three ways in which government spending can be financed.

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The belief that we can spend our way out of low growth is inconsistent with the best available
empirical evidence and ignores South Africa’s recent poor performance in using government
spending as a tool to unlock much‐needed economic growth. Gambling with our future on risky
economic strategies that have failed elsewhere is something we are not prepared to do.’ Tito
Mboweni is South Africa's Minister of Finance.

 

The increased government spending noted in Q.3.1. above has to be financed in
one way or another.
Describe three ways in which government spending can be financed.

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