Time-varying fiscal policy in the U.S

Manuel Pereira and Artur Silva Lopes (arturslopes@proton.me)

Working Papers from Banco de Portugal, Economics and Research Department

Abstract: To investigate time heterogeneity in the e¤ects of fiscal policy in the U.S., we use a non-recursive, Blanchard and Perotti-like structural VAR with time-varying parameters, estimated through Bayesian simulation over the 1965:2-2009:2 period. Our evidence suggests that fiscal policy has lost some capacity to stimulate output but that this trend is more pronounced for taxes net of transfers than for government expenditure, whose e¤ectivenessdeclines only slightly. Fiscal multipliers keep conventional signs throughout. An investigation of changes in ?scal policy conduct indicates an increase in the countercyclical activism of net taxes over time, which appears to have reached a maximum during the 2008-09 recession.

JEL-codes: C11 E32 E62 (search for similar items in EconPapers)
Date: 2010
New Economics Papers: this item is included in nep-cba and nep-pub
References: View complete reference list from CitEc
Citations: View citations in EconPapers (28)

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Related works:
Journal Article: Time-varying fiscal policy in the US (2014)
Working Paper: Time varying fiscal policy in the U.S (2010)
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Persistent link: https://EconPapers.repec.org/RePEc:ptu:wpaper:w201021

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