Fiscal Multipliers

La Follette School of Public Affairs Working Paper No. 2015-002

17 Pages Posted: 31 Jan 2013

See all articles by Menzie David Chinn

Menzie David Chinn

University of Wisconsin, Madison - Robert M. La Follette School of Public Affairs and Department of Economics; National Bureau of Economic Research (NBER)

Date Written: January 29, 2013

Abstract

The concept of fiscal multipliers is examined, in the context of the major theoretical approaches. Differing methods of calculating multipliers are then recounted (structural equations, VAR, simulation). The sensitivity of estimates to conditioning on the state of the economy (slack, financial system) and policy regimes (exchange rate system, monetary policy reaction function) is discussed.

Keywords: fiscal, spending, taxes, deficits, debt, crowding out, Ricardian equivalence, crowding out, portfolio balance, monetary reaction function

JEL Classification: E62, E43, F33, F41

Suggested Citation

Chinn, Menzie David, Fiscal Multipliers (January 29, 2013). La Follette School of Public Affairs Working Paper No. 2015-002, Available at SSRN: https://ssrn.com/abstract=2209121 or http://dx.doi.org/10.2139/ssrn.2209121

Menzie David Chinn (Contact Author)

University of Wisconsin, Madison - Robert M. La Follette School of Public Affairs and Department of Economics ( email )

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