Previous studies argue that, based on the New Keynesian framework, a fiscal stimulus financed by money creation has a … of an implementation lag in a money-financed fiscal stimulus on output. We show that if a money-financed government … demand. Our results imply that, if money demand is unstable, the money-financed fiscal stimulus with an implementation lag …

Previous studies argue that, based on the New Keynesian framework, a fiscal stimulus financed by money creation has a … of implementation lag in the money-financed fiscal stimulus on output. We show that if a money-financed government …-elasticity of money demand. Our results imply that to strengthen the efficacy of the money-financed fiscal stimulus, policymakers …

subsequent recovery in the US. The Great Recession was mainly caused by a large demand shock and by the ZLB on the interest rate …

short term debt financed government spending shock makes it easier for constrained households to meet their spending needs … larger multiplier when it issues short term debt. We find that the latter effect dominates and that the optimal policy for …

business cycle fluctuations. We apply this concept to account for the cross-country variation in the fiscal stimulus associated …/capita, and higher financial exposure to the US, were associated with a higher fiscal stimulus/GDP during 2009-2010. Intriguingly …, higher trade openness has been associated with lower fiscal stimulus. -- fiscal space ; fiscal stimulus ; trade openness …