In 1919 Wigforss was elected as a Social Democratic member of the First Chamber of the Swedish Parliament, representing Gothenburg, and he became a member of various committees. He was appointed a member of the third cabinet of Hjalmar Branting in 1924, and after Branting's resignation in January 1925, became a member of Rickard Sandler's cabinet. He was made temporary Minister of Finance on 24 January 1925 when Fredrik Thorsson fell ill, and succeeded him on 8 May of the same year, following his death. The Sandler cabinet resigned on 7 June 1926.
He was again Minister of Finance in the cabinets of Per Albin Hansson and Tage Erlander from 1932 to 1949.
Wigforss became Gunnar Myrdal's main political opponent with respect to the currency crisis of 1947. Swedish historians tend to interpret this crisis as Myrdal's political failure, while the historian Orjan Appelqvist argue that it is Wigforss and Axel Gjöres who hold primary responsibility for this political fiasco.[1]
Some[who?] say that Wigforss' economic policies were strongly influenced by John Maynard Keynes, but he may have anticipated Keynes, because he proposed counter-cyclical economic policy before becoming minister of finance in 1932. But it is perhaps most accurate to claim that his main economic influences came from Knut Wicksell. He inspired younger economists like Gunnar Myrdal and the Stockholm school, who worked in the same direction as Keynes at the same time. John Kenneth Galbraith writes that it "would be more fair to say 'The Swedish Economic Revolution' than the 'Keynesian revolution' in economics, and that Wigforss was first in this transformation of thinking and practice about economy".[2]
In his pamphlet Har vi råd att arbeta? (Can we afford to work?), widely believed to have won the 1932 elections for the Social Democrats, he made fun of the Liberal theory that budget cuts are the proper remedy for economic downturns. Although he is considered the creator of the Swedish social democratic economy, controversies with Minister for Social Affairs Gustav Möller (who would have preferred graduated taxation to have been higher) prevented both from being elected party chairman and Prime Minister at the death of Hansson.
