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News on asymmetric fiscal multipliers

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  • Cappelletti, Andrea

Abstract

This paper investigates the asymmetric effects of expansionary and contractionary fiscal shocks in the U.S. economy using a state-of-the-art non-linear local projection framework. To identify fiscal shocks, I use a proxy based on revisions to the mean forecast of government spending growth from the Survey of Professional Forecasters, which represent unexpected changes in expectations about government spending. The estimated fiscal multipliers are larger following positive fiscal shocks than following negative ones, indicating asymmetric effects of fiscal policy interventions.

Suggested Citation

  • Cappelletti, Andrea, 2026. "News on asymmetric fiscal multipliers," Economics Letters, Elsevier, vol. 267(C).
    • Handle: RePEc:eee:ecolet:v:267:y:2026:i:c:s0165176526002879
    DOI: 10.1016/j.econlet.2026.113093
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    JEL classification:

    • C32 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes; State Space Models
    • E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy; Modern Monetary Theory

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