Deficit Budget

Government budget is said to be deficit, when anticipated Government receipts are less than the estimated Government expenditure. That is anticipated Government Receipts < estimated Government Expenditure.

A deficit budget may prove useful during the period of depression. In the period of depression. In the period of depression, all economic activities are at low level which results in unemployment. This can be checked by increasing Government Expenditure, by borrowing money and through deficit financing. This will increase employment and aggregate effective demand for goods and services which would encourage further investment. In modern times, deficit budget is the most commonly implemented policy of any government. 

Developing countries like India have consistently resorted to deficit budget technique for economic development.