We identify fiscal impulses in the EU New Member States using four different methods and apply econometric panel data techniques to determine what is the response of the output and its components to those impulses. We also directly test the effects of fiscal impulses on labour costs and...

The prevailing narrative about the Great Recession is that it was caused by a financial crisis. This paper refutes that explanation and offers an alternative, namely that issuance of bad government debt played a key role in escalating a regular recession to an economic crisis

We use a novel quarterly dataset of U.S. states to examine the dynamics and determinants of relative government spending multipliers in the decade surrounding the Great Recession. We find average multipliers that are similar to those that have been reported for the decades preceding the crisis,...

Using a dataset covering a large sample of emerging economies (EMEs), westudy the relationship between debt and economic performance in bad times.While previous research has shown that private debt buildups exacerbate theduration and intensity of recessions in advanced economies (AEs), we...

This paper develops a structural macroeconometric model of the world economy, disaggregated into forty national economies. This panel dynamic stochastic general equilibrium model features a range of nominal and real rigidities, extensive macrofinancial linkages, and diverse spillover...

The financial crisis and its ensuing effects have brought back into the limelight the issue of cycles and of policies which fuel or mitigate crises. Cognitive and operational models in economics and business are questioned. There is a specter of much lower economic growth in the industrialized...

This paper identifies the effect of variation in government-backed loan supply on unemployment exploiting regional variation in the Swiss COVID-19 lending program. The rules of the program introduce variation in loan supply across Cantons. This variation helps disentangling supply from demand...

We study the role of firm heterogeneity in affecting business cycle dynamics and optimal stabilization policy. Firms differ in their degree of cyclicality, and hence, exposure to aggregate risk, leading to firm-specific risk premia that influence resource allocations. The heterogeneous firm...

We use a novel quarterly dataset of U.S. states to examine the dynamics and determinants of relative government spending multipliers in the decade surrounding the Great Recession. We find average multipliers that are similar to those that have been reported for the decades preceding the crisis,...

In the aftermath of the consumer debt–induced recession, policymakers have questioned whether fiscal stimulus is effective during periods of high consumer indebtedness. This study empirically investigates this question. Using detailed data on Department of Defense spending for the 2007–2009...