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Who Gains from President Obama's Stimulus Package ... And How Much?

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Listed:
  • Ajit Zacharias
  • Thomas Masterson
  • Kijong Kim

Abstract

In this Special Report, Levy scholars Ajit Zacharias, Thomas Masterson, and Kijong Kim provide a preliminary assessment of the 2009 American Recovery and Reinvestment Act (ARRA), a package of transfers and tax cuts that is expected to provide relief to low-income and vulnerable households especially hurt by the economic crisis, while at the same time supporting aggregate demand. By the administration's estimate, ARRA will create or save approximately three and a half million jobs by the end of 2010; while the ameliorating impact of the stimulus plan on the employment situation is surely welcome, say the authors, the government could have achieved far more at the same cost by skewing the stimulus package toward outlays rather than tax cuts. Their analysis points toward the necessity for a comprehensive employment strategy that goes well beyond ARRA. The need for public provisioning of various sorts--ranging from early childhood education centers to public health facilities to the “greening” of public transportation--coupled with the severe underutilization of labor, naturally suggests an expanded role for public employment as a desirable ingredient in any alternative strategy.

Suggested Citation

  • Ajit Zacharias & Thomas Masterson & Kijong Kim, 2009. "Who Gains from President Obama's Stimulus Package ... And How Much?," Economics Policy Note Archive sr_06-12-09, Levy Economics Institute.
  • Handle: RePEc:lev:levypn:sr_06-12-09
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    References listed on IDEAS

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    1. Cogan, John F. & Cwik, Tobias & Taylor, John B. & Wieland, Volker, 2010. "New Keynesian versus old Keynesian government spending multipliers," Journal of Economic Dynamics and Control, Elsevier, vol. 34(3), pages 281-295, March.
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    Cited by:

    1. Sara Hsu, 2013. "Financial Crises, 1929 to the Present," Books, Edward Elgar Publishing, number 14419.
    2. Verick, Sher. & Islam, Iyanatul,, 2010. "The great recession of 2008-2009 : causes, consequences and policy responses," ILO Working Papers 994576933402676, International Labour Organization.
    3. repec:ilo:ilowps:457693 is not listed on IDEAS

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