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Jump Starting the Euro Area Recovery : Would a Rise in Core Fiscal Spending Help the Periphery?
Blanchard, Olivier J. - 2015
We show that a fiscal expansion by the core economies of the euro area would have a large and positive impact on periphery GDP assuming that policy rates remain low for a prolonged period. Under our preferred model specification, an expansion of core government spending equal to one percent of...
Persistent link: https://www.econbiz.de/10013018304
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The Fiscal Multiplier
Hagedorn, Marcus - 2019
We measure the size of the fiscal multiplier using a heterogeneous-agent model with incomplete markets, capital and ….We find that market incompleteness is key to determining the size of the fiscal multiplier, which is uniquely determined in … our model for any combination of fiscal and monetary policies of interest. The multiplier is 1.34 if deficit-financed and …
Persistent link: https://www.econbiz.de/10012892557
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Ten Years after the Financial Crisis : What Have We Learned from the Renaissance in Fiscal Research?
Ramey, Valerie A. - 2019
This paper takes stock of what we have learned from the “Renaissance” in fiscal research in the ten years since the financial crisis. I first summarize the new innovations in methodology and discuss the various strengths and weaknesses of the main approaches. Reviewing the estimates, I come...
Persistent link: https://www.econbiz.de/10012893136
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Government Spending Multipliers in Good Times and in Bad : Evidence from U.S. Historical Data
Ramey, Valerie A. - 2014
This paper investigates whether U.S. government spending multipliers differ according to two potentially important features of the economy: (1) the amount of slack and (2) whether interest rates are near the zero lower bound. We shed light on these questions by analyzing new quarterly historical...
Persistent link: https://www.econbiz.de/10013043271
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Is Government Spending at the Zero Lower Bound Desirable?
Bilbiie, Florin - 2014
Government spending at the zero lower bound (ZLB) is not necessarily welfare enhancing, even when its output multiplier …
Persistent link: https://www.econbiz.de/10013043626
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Procyclical and Countercyclical Fiscal Multipliers : Evidence from OECD Countries
Riera-Crichton, Daniel - 2014
or decreases, the “true” long-run multiplier for bad times (and government spending going up) turns out to be 2 ….3 compared to 1.3 if we just distinguish between recession and expansion. In extreme recessions, the long-run multiplier reaches …
Persistent link: https://www.econbiz.de/10013046595
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Fiscal Stimulus and Fiscal Sustainability
Auerbach, Alan J. - 2017
The Great Recession and the Global Financial Crisis have left many developed countries with low interest rates and high levels of public debt, thus limiting the ability of policymakers to fight the next recession. Whether new fiscal stimulus programs would be jeopardized by these already heavy...
Persistent link: https://www.econbiz.de/10012948076
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Geographic Cross-Sectional Fiscal Spending Multipliers : What Have We Learned?
Chodorow-Reich, Gabriel - 2017
A geographic cross-sectional fiscal spending multiplier measures the effect of an increase in spending in one region in … Reinvestment Act and a survey of empirical studies, my preferred point estimate for a cross-sectional output multiplier is 1 ….8. Economic theory of how to map these multipliers into a national multiplier has also advanced. Drawing on the theoretical …
Persistent link: https://www.econbiz.de/10012951882
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Trade Flows and Fiscal Multipliers
Cacciatore, Matteo; Traum, Nora - 2022
We present novel insights on the role of international trade following unanticipated government spending and income tax changes in a flexible exchange rate environment. In a simple two-country, two-good model, we show analytically that fiscal multipliers can be larger in economies more open to...
Persistent link: https://www.econbiz.de/10014094626
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Clearing Up the Fiscal Multiplier Morass
Leeper, Eric M. - 2011
substitution effects, yielding uniform comparisons across models. By constraining the multiplier to tight ranges, model and prior …
Persistent link: https://www.econbiz.de/10013120209