Geographic Cross-Sectional Fiscal Multipliers: What Have We Learned?

Gabriel Chodorow-Reich

No 1214, 2017 Meeting Papers from Society for Economic Dynamics

Abstract: A geographic cross-sectional fiscal multiplier measures the effect of an increase in spending in one region in a monetary union. Empirical studies of such multipliers have proliferated in recent years. I review this research and find a cross-study mean cross-sectional output multiplier of about 2. Economic theory of how to map these multipliers into a national multiplier has also advanced. Drawing on the theoretical literature, I discuss conditions under which the cross-sectional multiplier can provide a rough lower bound for the closed economy deficit-financed constrained monetary policy multiplier. Putting these elements together, the cross-sectional evidence suggests a national multiplier of about 1.7 or above, larger than that found in most studies based on time series evidence. I conclude by offering suggestions for future research on cross-sectional multipliers.

Date: 2017
New Economics Papers: this item is included in nep-mac
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (27)

Downloads: (external link)
https://red-files-public.s3.amazonaws.com/meetpapers/2017/paper_1214.pdf (application/pdf)

Related works:
Working Paper: Geographic Cross-Sectional Fiscal Multipliers: What Have We Learned? (2017)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:red:sed017:1214

Access Statistics for this paper

More papers in 2017 Meeting Papers from Society for Economic Dynamics Contact information at EDIRC.
Bibliographic data for series maintained by Christian Zimmermann ().