Inequality and the Burden of Crisis: Fiscal Incidence in the Depression-Era Gold Coast

Prince Young Aboagye ()
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Prince Young Aboagye: Department of Economic History, Lund University, Postal: Department of Economic History, Lund University, Box 7083, S-220 07 Lund, Sweden

No 271, Lund Papers in Economic History from Lund University, Department of Economic History

Abstract: How did colonial fiscal systems respond to economic crisis, and what were the distributional consequences of those responses? This paper examines fiscal policy and inequality in the Gold Coast during the Great Depression using newly reconstructed tax revenues and expenditure data linked to social tables. It estimates the tax burden relative to income, the sectoral incidence of taxation, and the regional distribution of public finance. The paper shows that although measured inequality declined during the Depression, the tax burden relative to income remained high and increased as fiscal balance was restored, while fiscal incidence stayed regressive. Fiscal stabilization was achieved through expenditure retrenchment and continued reliance on indirect taxation, concentrating the burden of adjustment on the colony’s monetized sectors while preserving a spatial fiscal structure in which the export-producing south financed colonial administration across the territory. The paper therefore shows that inequality and fiscal incidence diverged over the crisis and adjustment period, and argues that aggregate inequality trends obscure the distributional effects of economic shocks in trade-dependent and fiscally rigid economies.

Keywords: Colonial Ghana (Gold Coast); Income inequality; Fiscal policy; Tax incidence; Great Depression; Social tables (search for similar items in EconPapers)
JEL-codes: D63 E62 H22 N47 (search for similar items in EconPapers)
Pages: 61 pages
Date: 2026-08-21
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