What Accounts for the Change in U.S. Fiscal Policy Transmission?

Abstract : Using vector autoregressions on U.S. time series for 1957-79 and 1983-2004, we find government spending shocks to have stronger effects on output, consumption, and wages in the earlier period. We try to account for this observation within a DSGE model featuring price rigidities and limited asset market participation. Specifically, we estimate the structural parameters of the model for both periods by matching impulse responses. Model-based counterfactual experiments suggest that most of the changes in fiscal policy transmission are accounted for by increased asset market participation and the more active monetary policy of the Volcker-Greenspan period.
Document type :
Journal articles
Complete list of metadatas

https://hal-paris1.archives-ouvertes.fr/hal-00622867
Contributor : Florin Bilbiie <>
Submitted on : Monday, September 12, 2011 - 10:01:33 PM
Last modification on : Tuesday, January 30, 2018 - 5:50:02 PM

Links full text

Identifiers

Collections

Citation

Florin Bilbiie, Gernot Mueller, Andre Meier. What Accounts for the Change in U.S. Fiscal Policy Transmission?. Journal of Money, Credit and Banking, Wiley, 2008, 40 (7), pp.1439-1470. ⟨10.1111/j.1538-4616.2008.00166.x⟩. ⟨hal-00622867⟩

Share

Metrics

Record views

220