Advanced Search
MyIDEAS: Login to save this paper or follow this series

Fiscal Multipliers: A Meta Regression Analysis

Contents:

Author Info

  • Sebastian Gechert
  • Henner Will

Abstract

Since the fiscal expansion during the Great Recession 2008-2009 and the current European consolidation and austerity measures, the analysis of fiscal multiplier effects is back on the scientific agenda. The number of empirical studies is growing fast, tackling the issue with manifold model classes, identification strategies, and specifications. While plurality of methods seems to be a good idea to address a complicated issue, the results are far off consensus. We apply meta regression analysis to a set of 89 studies on multiplier effects in order to provide a systematic overview of the different approaches, to derive stylized facts and to separate structural from method-specific effects. We classify studies with respect to type of fiscal impulse, model class, multiplier calculation method and further control variables. Moreover, we analyse subsamples of the model classes in order to evaluate the effects of model-class-specific properties, currently discussed in the literature, such as the influence of central bank reaction functions and liquidity constrained households. As a major result, we find that the reported size of the fiscal multiplier crucially depends on the setting and method chosen. Thus, economic policy consulting based on a certain multiplier study should lay open by how much specification affects the results. Our meta analysis may provide guidance concerning influential factors.

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
File URL: http://www.boeckler.de/pdf/p_imk_wp_97_2012.pdf
Download Restriction: no

Bibliographic Info

Paper provided by IMK at the Hans Boeckler Foundation, Macroeconomic Policy Institute in its series IMK Working Paper with number 97-2012.

as in new window
Length: 36 pages
Date of creation: 2012
Date of revision:
Handle: RePEc:imk:wpaper:97-2012

Contact details of provider:
Postal: Hans-Böckler-Straße 39, 40476 Düsseldorf
Phone: +49 211 7778 234
Fax: +49 211 7778 4234
Email:
Web page: http://www.imk-boeckler.de
More information through EDIRC

Related research

Keywords: multiplier effects; fiscal policy; meta analysis;

Find related papers by JEL classification:

References

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
as in new window
  1. Lars P. Feld & Jost H. Heckemeyer, 2011. "Fdi And Taxation: A Meta‐Study," Journal of Economic Surveys, Wiley Blackwell, Wiley Blackwell, vol. 25(2), pages 233-272, 04.
  2. Ardagna, Silvia, 2001. " Fiscal Policy Composition, Public Debt, and Economic Activity," Public Choice, Springer, Springer, vol. 109(3-4), pages 301-25, December.
  3. Shafik Hebous, 2011. "The Effects Of Discretionary Fiscal Policy On Macroeconomic Aggregates: A Reappraisal," Journal of Economic Surveys, Wiley Blackwell, Wiley Blackwell, vol. 25(4), pages 674-707, 09.
  4. Agnès Bénassy-Quéré & Jacopo Cimadomo, 2006. "Changing Patterns of Domestic and Cross-Border Fiscal Policy Multipliers in Europe and the US," Working Papers 2006-24, CEPII research center.
  5. David E. Card & Jochen Kluve & Andrea Weber, 2009. "Active Labor Market Policy Evaluations: A Meta-analysis," NRN working papers, The Austrian Center for Labor Economics and the Analysis of the Welfare State, Johannes Kepler University Linz, Austria 2009-02, The Austrian Center for Labor Economics and the Analysis of the Welfare State, Johannes Kepler University Linz, Austria.
  6. Valerie A. Ramey, 2011. "Can Government Purchases Stimulate the Economy?," Journal of Economic Literature, American Economic Association, American Economic Association, vol. 49(3), pages 673-85, September.
  7. Michael Woodford, 2010. "Simple Analytics of the Government Expenditure Multiplier," NBER Working Papers 15714, National Bureau of Economic Research, Inc.
  8. Mountford, Andrew & Uhlig, Harald, 2002. "What are the Effects of Fiscal Policy Shocks?," CEPR Discussion Papers, C.E.P.R. Discussion Papers 3338, C.E.P.R. Discussion Papers.
  9. Marek Rusnak & Tomas Havranek & Roman Horvath, 2011. "How to Solve the Price Puzzle? A Meta-Analysis," Working Papers, Czech National Bank, Research Department 2011/02, Czech National Bank, Research Department.
  10. Baxter, Marianne & King, Robert G, 1993. "Fiscal Policy in General Equilibrium," American Economic Review, American Economic Association, American Economic Association, vol. 83(3), pages 315-34, June.
  11. Olivier Blanchard & Roberto Perotti, 1999. "An Empirical Characterization of the Dynamic Effects of Changes in Government Spending and Taxes on Output," NBER Working Papers 7269, National Bureau of Economic Research, Inc.
  12. T. D. Stanley, 2008. "Meta-Regression Methods for Detecting and Estimating Empirical Effects in the Presence of Publication Selection," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, Department of Economics, University of Oxford, vol. 70(1), pages 103-127, 02.
  13. Roel Beetsma & Massimo Giuliodori, 2011. "The Effects of Government Purchases Shocks: Review and Estimates for the EU," Economic Journal, Royal Economic Society, Royal Economic Society, vol. 121(550), pages F4-F32, February.
  14. Christina D. Romer & David H. Romer, 2007. "The Macroeconomic Effects of Tax Changes: Estimates Based on a New Measure of Fiscal Shocks," NBER Working Papers 13264, National Bureau of Economic Research, Inc.
  15. Roberto Perotti, 2005. "Estimating the effects of fiscal policy in OECD countries," Proceedings, Federal Reserve Bank of San Francisco, Federal Reserve Bank of San Francisco.
  16. Bilbiie, Florin O. & Meier, André & Müller, Gernot J., 2006. "What accounts for the changes in U.S. fiscal policy transmission?," Working Paper Series, European Central Bank 0582, European Central Bank.
  17. Freedman, Charles & Kumhof, Michael & Laxton, Douglas & Muir, Dirk & Mursula, Susanna, 2010. "Global effects of fiscal stimulus during the crisis," Journal of Monetary Economics, Elsevier, Elsevier, vol. 57(5), pages 506-526, July.
  18. Tobias Cwik & Volker Wieland, 2011. "Keynesian government spending multipliers and spillovers in the euro area," Economic Policy, CEPR;CES;MSH, CEPR;CES;MSH, vol. 26(67), pages 493-549, 07.
  19. Card, David & Krueger, Alan B, 1995. "Time-Series Minimum-Wage Studies: A Meta-analysis," American Economic Review, American Economic Association, American Economic Association, vol. 85(2), pages 238-43, May.
  20. Robert S. Goldfarb & H. O. Stekler, 2002. "Wheat from Chaff: Meta-Analysis as Quantitative Literature Review: Comment," Journal of Economic Perspectives, American Economic Association, American Economic Association, vol. 16(3), pages 225-226, Summer.
  21. Jonathan A. Parker, 2011. "On Measuring the Effects of Fiscal Policy in Recessions," NBER Working Papers 17240, National Bureau of Economic Research, Inc.
  22. T. D. Stanley & Stephen B. Jarrell, 2005. "Meta-Regression Analysis: A Quantitative Method of Literature Surveys," Journal of Economic Surveys, Wiley Blackwell, Wiley Blackwell, vol. 19(3), pages 299-308, 07.
  23. Alan J. Auerbach & Yuriy Gorodnichenko, 2012. "Measuring the Output Responses to Fiscal Policy," American Economic Journal: Economic Policy, American Economic Association, American Economic Association, vol. 4(2), pages 1-27, May.
  24. Antonio Fatás & Ilian Mihov, 2009. "Why Fiscal Stimulus is Likely to Work," International Finance, Wiley Blackwell, Wiley Blackwell, vol. 12(1), pages 57-73, 05.
  25. Caldara, Dario & Kamps, Christophe, 2008. "What are the effects of fiscal policy shocks? A VAR-based comparative analysis," Working Paper Series, European Central Bank 0877, European Central Bank.
  26. Ardagna, Silvia, 2001. "Fiscal Policy Composition, Public Debt, and Economic Activity," Scholarly Articles 2579823, Harvard University Department of Economics.
  27. Nijkamp, Peter & Poot, Jacques, 2004. "Meta-analysis of the effect of fiscal policies on long-run growth," European Journal of Political Economy, Elsevier, Elsevier, vol. 20(1), pages 91-124, March.
  28. Linnemann, Ludger, 2006. "The Effect of Government Spending on Private Consumption: A Puzzle?," Journal of Money, Credit and Banking, Blackwell Publishing, Blackwell Publishing, vol. 38(7), pages 1715-1735, October.
  29. Perotti, Roberto, 2005. "Estimating the Effects of Fiscal Policy in OECD Countries," CEPR Discussion Papers, C.E.P.R. Discussion Papers 4842, C.E.P.R. Discussion Papers.
  30. Carine Bouthevillain & John Caruana & Cristina Checherita & Jorge Cunha & Esther Gordo & Stephan Haroutunian & Amela Hubic & Geert Langenus & Bernhard Manzke & Javier J. Pérez & Pietro Tommasino, 2009. "Pros and Cons of various fiscal measures to stimulate the economy," BCL working papers, Central Bank of Luxembourg 40, Central Bank of Luxembourg.
  31. T. D. Stanley, 2001. "Wheat from Chaff: Meta-analysis as Quantitative Literature Review," Journal of Economic Perspectives, American Economic Association, American Economic Association, vol. 15(3), pages 131-150, Summer.
Full references (including those not matched with items on IDEAS)

Citations

Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
as in new window

Cited by:
  1. Achim Truger, 2013. "Steuerpolitik im Dienste der Umverteilung: eine makroökonomische Ergänzung," Vierteljahrshefte zur Wirtschaftsforschung / Quarterly Journal of Economic Research, DIW Berlin, German Institute for Economic Research, DIW Berlin, German Institute for Economic Research, vol. 82(1), pages 43-59.
  2. Jan Babecky & Tomas Havranek, 2013. "Structural Reforms and Growth in Transition: A Meta-Analysis," William Davidson Institute Working Papers Series, William Davidson Institute at the University of Michigan wp1057, William Davidson Institute at the University of Michigan.
  3. Robert Ambrisko & Jan Babecky & Jakub Rysanek & Vilem Valenta, 2012. "Assessing the Impact of Fiscal Measures on the Czech Economy," Working Papers, Czech National Bank, Research Department 2012/15, Czech National Bank, Research Department.
  4. IMK Düsseldorf & OFCE Paris & WIFO Wien, 2013. "Crisis continues to smoulder," IMK Report, IMK at the Hans Boeckler Foundation, Macroeconomic Policy Institute 80e-2013, IMK at the Hans Boeckler Foundation, Macroeconomic Policy Institute.
  5. Sebastian Gechert, 2013. "What fiscal policy is most effective? A Meta Regression Analysis," IMK Working Paper, IMK at the Hans Boeckler Foundation, Macroeconomic Policy Institute 117-2013, IMK at the Hans Boeckler Foundation, Macroeconomic Policy Institute.
  6. Truger, Achim, 2013. "Austerity in the Euro area: The sad state of economic policy in Germany and the EU," IPE Working Papers, Berlin School of Economics and Law, Institute for International Political Economy (IPE) 22/2013, Berlin School of Economics and Law, Institute for International Political Economy (IPE).
  7. Luiz de Mello, 2013. "What Can Fiscal Policy Do in the Current Recession? A Review of Recent Literature and Policy Options," Hacienda Pública Española, IEF, IEF, vol. 204(1), pages 113-139, March.
  8. Robert Ambrisko & Vitezslav Augusta & Jan Babecky & Michal Franta & Dana Hajkova & Petr Kral & Jan Libich & Pavla Netusilova & Milan Rikovsky & Jakub Rysanek & Pavel Soukup & Petr Stehlik & Vilem Vale, 2013. "Macroeconomic Effects of Fiscal Policy," Occasional Publications - Edited Volumes, Czech National Bank, Research Department, Czech National Bank, Research Department, edition 2, volume 11, number rb11/2 edited by Jan Babecky & Kamil Galuscak, August.
  9. Gustav A. Horn & Alexander Herzog-Stein & Ansgar Rannenberg & Katja Rietzler & Silke Tober & Rudolf Zwiener, 2014. "Wirtschaftspolitische Herausforderungen 2014," IMK Report, IMK at the Hans Boeckler Foundation, Macroeconomic Policy Institute 90-2014, IMK at the Hans Boeckler Foundation, Macroeconomic Policy Institute.
  10. Jan Babecky & Tomas Havranek, 2014. "Structural reforms and growth in transition," The Economics of Transition, The European Bank for Reconstruction and Development, The European Bank for Reconstruction and Development, vol. 22(1), pages 13-42, 01.
  11. Gustav A. Horn & Sebastian Gechert & Alexander Herzog-Stein & Katja Rietzler & Silke Tober & Sabine Stephan & Andrew Watt, 2013. "Inmitten der Krise des Euroraums - Herausforderungen für die Wirtschaftspolitik 2013," IMK Report, IMK at the Hans Boeckler Foundation, Macroeconomic Policy Institute 79-2013, IMK at the Hans Boeckler Foundation, Macroeconomic Policy Institute.
  12. Tommaso Ferraresi & Andrea Roventini & Giorgio Fagiolo, 2013. "Fiscal policies and credit regimes: a tvar approach," Documents de Travail de l'OFCE, Observatoire Francais des Conjonctures Economiques (OFCE) 2013-02, Observatoire Francais des Conjonctures Economiques (OFCE).
  13. Godar, Sarah & Paetz, Christoph & Truger, Achim, 2014. "Progressive tax reform in OECD countries : perspectives and obstacles," ILO Working Papers, International Labour Organization 485510, International Labour Organization.
  14. Walid Qazizada & Engelbert Stockhammer, 2014. "Government spending multipliers in contraction and expansion," Working Papers, Post Keynesian Economics Study Group (PKSG) PKWP1404, Post Keynesian Economics Study Group (PKSG).
  15. IMK Düsseldorf & OFCE Paris & WIFO Wien, 2013. "Die Krise schwelt weiter," IMK Report, IMK at the Hans Boeckler Foundation, Macroeconomic Policy Institute 80-2013, IMK at the Hans Boeckler Foundation, Macroeconomic Policy Institute.

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:imk:wpaper:97-2012. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Sabine Nemitz).

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.