Alan Auerbach, Yuriy Gorodnichenko, Daniel Murphy, 04 April 2019

The strength of fiscal multipliers and spillovers have been the subject of intense debate in recent years.Using data on US Department of Defense contracts and income and employment outcomes, this column finds evidence of  strong positive spillovers across locations and industries, although the geographical spillovers appear to dissipate fairly quickly with distance. Both backward linkages and general equilibrium effects contribute to the positive spillovers.

Alessandro Cugnasca, Philipp Rother, 05 December 2015

The size of fiscal multipliers has been the subject of major public policy debates in the past few years. This column provides evidence that, on average, the size of the fiscal multiplier is in line with assumptions made by policymakers at the start of the crisis. The effects of fiscal consolidation, however, vary significantly depending on the state of the economy and the composition of the fiscal adjustment.

Jan Mohlmann, Wim Suyker, 01 December 2015

Olivier Blanchard and Daniel Leigh’s work on growth forecast errors and fiscal multipliers in 2009-2011 has been highly influential. This column extends their approach to recent years. The authors do not find convincing evidence for stronger-than-expected fiscal multipliers for EU countries during the sovereign debt crisis (2012-2013) or during the tepid recovery thereafter. 

Sebastian Gechert, Andrew Hughes Hallett, Ansgar Rannenberg, 26 February 2015

The literature on fiscal multipliers has expanded greatly since the outbreak of the Global Crisis. This column reports on a meta-regression analysis of fiscal multipliers collected from a broad set of empirical reduced form models. Multiplier estimates are significantly higher during economic downturns. Spending multipliers exceed tax multipliers, especially during recessions. The authors estimate that the Eurozone’s fiscal consolidation – most significantly transfer cuts – reduced GDP by 4.3% relative to the no-consolidation baseline in 2011, increasing to 7.7% in 2013.

Sebastian Gechert, Andrew Hughes Hallett, Ansgar Rannenberg, 25 February 2015

The literature on fiscal multipliers has expanded greatly since the outbreak of the Global Crisis. CEPR Policy Insight 79 reports on a meta-regression analysis of fiscal multipliers collected from a broad set of empirical reduced form models. Multiplier estimates are significantly higher during economic downturns. Spending multipliers exceed tax multipliers, especially during recessions. The authors estimate that the Eurozone’s fiscal consolidation – most significantly transfer cuts – reduced GDP by 4.3% relative to the no-consolidation baseline in 2011, increasing to 7.7% in 2013.

Enrique Mendoza, Carlos Vegh, Ethan Ilzetzki, 01 October 2009

Economists do not agree on one question crucial to evaluating governments' responses to the crisis: how much stimulus does spending provide? CEPR Policy Insight No.39 examines how the characteristics of an economy impact on the size of fiscal multipliers.

Events

  • 17 - 18 August 2019 / Peking University, Beijing / Chinese University of Hong Kong – Tsinghua University Joint Research Center for Chinese Economy, the Institute for Emerging Market Studies at Hong Kong University of Science and Technology, the Guanghua School of Management at Peking University, the Stanford Center on Global Poverty and Development at Stanford University, the School of Economics and Management at Tsinghua University, BREAD, NBER and CEPR
  • 19 - 20 August 2019 / Vienna, Palais Coburg / WU Research Institute for Capital Markets (ISK)
  • 29 - 30 August 2019 / Galatina, Italy /
  • 4 - 5 September 2019 / Roma Eventi, Congress Center, Pontificia Università Gregoriana Piazza della Pilotta, 4, Rome, Italy / European Center of Sustainable Development , CIT University
  • 9 - 14 September 2019 / Guildford, Surrey, UK / The University of Surrey

CEPR Policy Research