Skip to main content Accessibility help
Hostname: page-component-5d6d958fb5-zkswk Total loading time: 1.692 Render date: 2022-11-28T06:00:04.363Z Has data issue: true Feature Flags: { "shouldUseShareProductTool": true, "shouldUseHypothesis": true, "isUnsiloEnabled": true, "useRatesEcommerce": false, "displayNetworkTab": true, "displayNetworkMapGraph": false, "useSa": true } hasContentIssue true

15 - What Do We Know about Fiscal Multipliers?

from Part IV - The Comeback of Discretionary Fiscal Policy

Published online by Cambridge University Press:  19 May 2017

Ľudovít Ódor
Council for Budget Responsibility, Slovakia
Get access


Image of the first page of this content. For PDF version, please use the ‘Save PDF’ preceeding this image.'
Publisher: Cambridge University Press
Print publication year: 2017

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)


Acconcia, A., Corsetti, G. and Simonelli, S. (2013). Mafia and public spending: evidence on the fiscal multiplier from a quasi-experiment. American Economic Review, 104(7), 2185–209.Google Scholar
Alesina, A. and Ardagna, S. (2010). Large changes in fiscal policy: taxes versus spending. Tax Policy and the Economy, 24, 3568.CrossRefGoogle Scholar
Alesina, A. and Perotti, R. (1997). The welfare state and competitiveness. American Economic Review, 87, 347–66.Google Scholar
Alesina, A., Ardagna, S., Perotti, R. and Schiantarelli, F. (2002). Fiscal policy, profits and investment. American Economic Review, 92(3), 571–89.CrossRefGoogle Scholar
Alesina, A., Barbiero, O., Favero, C. , Giavazzi, F. and Paradisi, M. (2014). Austerity in 2009–2013. Paper prepared for 60th panel meeting of Economic Policy, October 2014.
Alesina, A., Favero, C., and Giavazzi, F. (2015). The output effects of fiscal stabilization plans. Journal of International Economics, 96(1), S19S42.CrossRefGoogle Scholar
Auerbach, A. and Gorodnichenko, Y. (2012). Measuring the output responses to fiscal policy. American Economic Journal: Economic Policy, 4(2), 127.Google Scholar
Bachmann, R. and Sims, E. (2011). Confidence and the Transmission of Government Spending Shocks. NBER Working Paper No. 17063, National Bureau of Economic Research, Inc.
Barro, R. J. and Redlick, C. J. (2011). Macroeconomic effects from government purchases and taxes. The Quarterly Journal of Economics, 126(1), 51102.CrossRefGoogle Scholar
Ben Zeev, N. and Pappa, E. (2014). Chronicle of a War Foretold: The Macroeconomic Effects of Anticipated Defense Spending Shocks. Mimeo, European University Institute.Google Scholar
Baxter, M. and King, R. G. (1993). Fiscal policy in general equilibrium. American Economic Review, 83(3), 315–34.Google Scholar
Blanchard, O. and Perotti, R. (2002). An empirical characterization of the dynamic effects of changes in government spending and taxes on output. Quarterly Journal of Economics, 117(4), 1329–68.CrossRefGoogle Scholar
Blanchard, O. and Leigh, D. (2013). Growth Forecast Errors and Fiscal Multipliers. IMF Working Paper No. 13/1. Washington, DC: International Monetary Fund.CrossRefGoogle Scholar
Beetsma, R., Cimadomo, J., Fortuna, O. Giuliodori, M. (2015). The Confidence Effects of Fiscal Consolidations. ECB Working Paper No. 1770, March 2015.
Bloom, N. (2009). The impact of uncertainty shocks. Econometrica, 77(3), 623–85.Google Scholar
Burnside, C., Eichenbaum, M. and Fisher, J. D. M. (2004). Fiscal shocks and their consequences. Journal of Economic Theory, 115(1), 89117.CrossRefGoogle Scholar
Caggiano, G., Castelnuovo, E., Colombo, V. and Nodari, G. (2015). Estimating fiscal multipliers: news from a non-linear world. The Economic Journal, 125, 746–76.CrossRefGoogle Scholar
Caldara, D. (2011). The Analytics of SVARs: A Unified Framework to Measure Fiscal Multipliers. IIES Working Paper,
Cavallo, M. (2005). Government Employment Expenditure and the Effects of Fiscal Policy Shocks. Federal Reserve Bank of San Francisco Working Paper No. 2005-16.
Christiano, L. J., Eichenbaum, M. and Evans, C. L. (1998). Monetary Policy Shocks: What Have We Learned and to What End? NBER Working Paper No. 6400.
Christiano, L.J., Eichenbaum, M. and Rebelo, S. (2011). When is the government spending multiplier large? Journal of Political Economy, 119(1), 78121.CrossRefGoogle Scholar
Chung, H. and Leeper, E. M. (2007). What Has Financed Government Debt? NBER Working Paper No. W12345.
Cloyne, J. (2013). Discretionary tax changes and the macroeconomy: new narrative evidence from the United Kingdom. The American Economic Review, 103(4): 1507–28.Google Scholar
Corsetti, G., Meier, A. and Mueller, G. (2012a). Fiscal stimulus with spending reversals. The Review of Economics and Statistics, 94(4), 878–95.Google Scholar
Corsetti, G., Meier, A. and Mueller, G. (2012b). What determines government spending multipliers. Economic Policy, CEPR;CES;MSH, 27(72), 523–64.Google Scholar
de Cos, P. H. and Mora, E. (2012). Fiscal Consolidations and Economic Growth. Working Paper, Banco de Espana.
DeLong, J. B. and Summers, L. H. (2012). Fiscal Policy in a Depressed Economy. Working Paper.
Drautzburg, T. and Uhlig, H. (2015). Fiscal stimulus and distortionary taxation. Review of Economic Dynamics, 18(4), 894920.CrossRefGoogle Scholar
Dell’Erba, S., Mattina, T. and Roitman, A. (2013). Pressure or Prudence? Tales of Market Pressure and Fiscal Adjustment. IMF Working Paper No. 13/170. Washington, DC: International Monetary Fund.Google Scholar
Devries, P., Guajardo, J., Leigh, D. and Pescatori, A. (2011). A New Action-Based Dataset of Fiscal Consolidations. IMF Working Paper No. 11/128. Washington, DC: International Monetary Fund.Google Scholar
Edelberg, W., Eichenbaum, M. and Fisher, J. D. M. (1999). Understanding the effects of a shock to government purchases. Review of Economic Dynamics, 2(1), 166206.CrossRefGoogle Scholar
Eggertsson, G. B. (2010). What fiscal policy is effective at zero interest rates? In Acemoglu, D. and Woodford, M., eds., NBER Macroeconomic Annual. Chicago: Chicago University Press, 59112.Google Scholar
Eggertsson, G. B. and Krugman, P. (2012). Debt, deleveraging, and the liquidity trap. Quarterly Journal of Economics, 127(3), 1469–513.CrossRefGoogle Scholar
Fatás, A. and Mihov, I. (2001). The Effects of Fiscal Policy on Consumption and Employment: Theory and Evidence. Mimeo, INSEAD.
Favero, C. and Giavazzi, F. (2012). Measuring tax multipliers: the narrative method in fiscal VARs. American Economic Journal: Economic Policy, 4(2), 6994.Google Scholar
Favero, C., Giavazzi, F. and Perego, J. (2011). Country heterogeneity and the international evidence on the effects of fiscal policy. IMF Economic Review, 59(4), 652–82.CrossRefGoogle Scholar
Fisher, Jonas D. M. and Peters, R. (2010). Using stock returns to identify government spending shocks. The Economic Journal, 120 (May), 414–36.CrossRefGoogle Scholar
Gal, J., López-Salido, J. D. and Vallés, J. (2007). Understanding the effects of government spending on consumption. Journal of the European Economic Association, 5(1), 227–70.Google Scholar
Garratt, A., Lee, K., Pesaran, M. H. and Shin, Y. (2012). Global and National Macroeconometric Modelling: A Long-Run Structural Approach. Oxford: Oxford University Press.Google Scholar
Giavazzi, F. and Pagano, M. (1990). Can severe fiscal contractions be expansionary? Tales of two small European countries. NBER Chapters in NBER Macroeconomics Annual, 5, 75122.CrossRefGoogle Scholar
Giavazzi, F. and McMahon, M. (2013). The household effects of government spending. In Alesina, A. and Giavazzi, F., eds., Fiscal Policy after the Financial Crisis. Chicago and London: University of Chicago Press and NBER.Google Scholar
Guajardo, Jaime, Leigh, D. and Pescatori, A. (2014). Expansionary austerity? International evidence. Journal of the European Economic Association, 12(4), 949–68.CrossRefGoogle Scholar
Hernandez da Cos, P. and Moral-Benito, E. (2011). Endogenous Fiscal Consolidations. Working Paper No. 1102, Banco de Espana.
Jalil, A. (2012). Comparing Tax and Spending Multipliers: It Is All About Controlling for Monetary Policy. Mimeo, Dept of Economics, Reed College.
Leeper, E. M. (2010). Monetary Science, Fiscal Alchemy. Proceedings – Economic Policy Symposium – Jackson Hole, Federal Reserve Bank of Kansas City, pp. 361–434.
Leeper, E. M., Walker, T. B. and Yang, S.-C. (2013). Fiscal foresight and information flows. Econometrica, 81(3), 1115–45.Google Scholar
Leeper, E. M., Traum, N. and Walker, T. (2015). Clearing Up the Fiscal Multiplier Morass,
Lippi, M. and Reichlin, L. (1994). VAR analysis, non fundamental representations, Blaschke matrices. Journal of Econometrics, 63(1), 307–25.CrossRefGoogle Scholar
Lucas, R. (1976). Econometric policy evaluation: a critique. In Brunner, K. and Meltzer, A., eds., The Phillips Curve and Labor Markets. Carnegie-Rochester Conference Series on Public Policy, 1. New York: American Elsevier, pp. 1946.Google Scholar
Mertens, K. and Ravn, M. O. (2011). Understanding the aggregate effects of anticipated and unanticipated tax policy shocks. Review of Economic Dynamics, 14(1), 2754.CrossRefGoogle Scholar
Mertens, K. and Ravn, M. O. (2013). The dynamic effects of personal and corporate income tax changes in the United States. American Economic Review, 103(4), 2012–47.CrossRefGoogle Scholar
Mertens, Karel, and Ravn, Morten O. (2014). A reconciliation of SVAR and narrative estimates of tax multipliers. Journal of Monetary Economics, 68, S1S19.CrossRefGoogle Scholar
Mountford, A. and Uhlig, H. (2009). What are the effects of fiscal policy shocks? Journal of Applied Econometrics, 24, 960–92.CrossRefGoogle Scholar
Òscar, J. (2005). Estimation and inference of impulse responses by local projections. American Economic Review, 95(1): 161–82.Google Scholar
Òscar, J and Taylor, Alan M. (2013). The Time for Austerity: Estimating the Average Treatment Effect of Fiscal Policy. NBER Working Papers No. 19414, National Bureau of Economic Research, Inc.
Perotti, R. (2005). Estimating the Effects of Fiscal Policy in OECD Countries. CEPR Discussion Paper No. 168. Centre for Economic Policy Research, London.
Perotti, Roberto (2008). In search of the transmission mechanism of fiscal policy. In Acemoglu, D., Rogoff, K. and Woodford, M., eds., NBER Macroeconomics Annual 2007, 22. Chicago: University of Chicago Press, pp. 169226.Google Scholar
Perotti, Roberto (2013). The austerity myth: gain without pain. In Alesina, Alberto and Giavazzi, Francesco, eds., Fiscal Policy after the Financial Crisis. Chicago and London: University of Chicago Press and National Bureau of Economic Research, 307–54.Google Scholar
Ramey, V. (2011a). Identifying government spending shocks: it’s all in the timing. Quarterly Journal of Economics, 126(1), 150.CrossRefGoogle Scholar
Ramey, V. (2011b). Can government purchases stimulate the economy? Journal of Economic Literature, 49(3), 673–85.CrossRefGoogle Scholar
Ramey, V. (2013). Government spending and private activities. In Alesina, A. and Giavazzi, F., eds., Fiscal Policy after the Financial Crisis. Chicago and London: University of Chicago Press and NBER, pp. 1955.CrossRefGoogle Scholar
Ramey, V. (2016). Macroeconomic shocks and their propagation. In Taylor, J. and Uhlig, H., eds., Handbook of Macroeconomics, 2. Amsterdam: Elsevier, pp. 71162.Google Scholar
Ramey, V., Owyang, M. and Zubairy, S. (2013). Are government spending multipliers greater during periods of slack? Evidence from 20th century historical data. American Economic Review, Papers and Proceedings, 103(3), 129–34.Google Scholar
Ramey, V. A. and Zubairy, S. (2014). Government Spending Multipliers in Good Times and in Bad: Evidence from US Historical Data. Working paper, November.
Romer, C. and Romer, D. H. (2010). The macroeconomic effects of tax changes: estimates based on a new measure of fiscal shocks. American Economic Review, 100(3), 763801.CrossRefGoogle Scholar
Schmitt-Grohe, S. and Uribe, M. (2012). What’s news in business cycles. Econometrica, 80(6), 2733–64.Google Scholar
Uhlig, H. (2005). What are the effects of monetary policy? Results from an agnostic identification procedure. Journal of Monetary Economics, 52(2), 381419.CrossRefGoogle Scholar
Uhlig, Harald (2010). Some fiscal calculus. American Economic Review, 100(2), 30–4.CrossRefGoogle Scholar
Uhlig, Harald (2012). Economics and reality. Journal of Macroeconomics, 34(March), 2941.CrossRefGoogle Scholar

Save book to Kindle

To save this book to your Kindle, first ensure is added to your Approved Personal Document E-mail List under your Personal Document Settings on the Manage Your Content and Devices page of your Amazon account. Then enter the ‘name’ part of your Kindle email address below. Find out more about saving to your Kindle.

Note you can select to save to either the or variations. ‘’ emails are free but can only be saved to your device when it is connected to wi-fi. ‘’ emails can be delivered even when you are not connected to wi-fi, but note that service fees apply.

Find out more about the Kindle Personal Document Service.

Available formats

Save book to Dropbox

To save content items to your account, please confirm that you agree to abide by our usage policies. If this is the first time you use this feature, you will be asked to authorise Cambridge Core to connect with your account. Find out more about saving content to Dropbox.

Available formats

Save book to Google Drive

To save content items to your account, please confirm that you agree to abide by our usage policies. If this is the first time you use this feature, you will be asked to authorise Cambridge Core to connect with your account. Find out more about saving content to Google Drive.

Available formats