Showing 1 - 10 of 3,053
This paper provides estimates of the government spending multiplier over the monetary policy cycle. We identify government spending shocks as forecast errors of the growth rate of government spending from the Survey of Professional Forecasters (SPF) and from the Greenbook record. The state of...
Persistent link: https://www.econbiz.de/10013020275
The presence of the lagged shadow policy rate in the interest rate feedback rule reduces the government spending multiplier nontrivially when the policy rate is constrained at the zero lower bound (ZLB). In the economy with policy inertia, increased inflation and output due to higher government...
Persistent link: https://www.econbiz.de/10013031117
Some recent empirical evidence questions the typically large size of government spending multipliers when the nominal interest rate is stuck at zero, finding output multipliers of around 1 or even lower, with an upper bound of around 1.5 in some circumstances. In this paper, we use a recent...
Persistent link: https://www.econbiz.de/10012919561
The scale of public expenditure to be incurred in the Covid-19 health crisis is raising heated debates about the appropriate funding. Long rejected by mainstream macroeconomics due to its possible inflationary consequences, monetization is currently undergoing a surprising rehabilitation....
Persistent link: https://www.econbiz.de/10012233283
Fiscal multipliers provide a way of quantifying the GDP gain for a given (discretionary) fiscal policy intervention. I compute government consumption multipliers for New Zealand, in normal times and when monetary policy is constrained at the effective lower bound, using an estimated...
Persistent link: https://www.econbiz.de/10014533165
We use Bayesian prior and posterior analysis of a monetary DSGE model, extended to include fiscal details and two distinct monetary-fiscal policy regimes, to quantify government spending multipliers in U.S. data. The combination of model specification, observable data, and relatively diffuse...
Persistent link: https://www.econbiz.de/10013018514
This paper demonstrates how adding nominal wage rigidity to a standard sticky price model can create a mechanism by which increases in government spending cause increases in consumption. The increase in output arising from government purchases puts upward pressure on the price level. At a fixed...
Persistent link: https://www.econbiz.de/10013210473
The COVID-19 pandemic forced much of the world to adapt suddenly to severe restrictions. In this study, we attempt to quantify the impact of the pandemic on student performance in higher education. To collect data on important covariates, we conducted a survey among first-year students of...
Persistent link: https://www.econbiz.de/10012499494
Much of the research on fiscal multipliers has used reduced form modelling approaches. While these models have been extended to include richer controls and identification approaches, it remains unclear whether shocks identified capture the true structural shocks. An alternative way to identify...
Persistent link: https://www.econbiz.de/10012241962
This paper studies fiscal policy in a New Keynesian DSGE model with endogenous technology growth in which scarring can occur endogenously through hysteresis effects in TFP. Both demand- and supply-driven recessions can weaken investment in R&D and technology adoption, thus depressing the...
Persistent link: https://www.econbiz.de/10013463787