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

Florin Bilbiie, Andre Meier and Gernot J. M‹ller
Authors registered in the RePEc Author Service: Gernot J. Müller

Journal of Money, Credit and Banking, 2008, vol. 40, issue 7, 1439-1470

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. Copyright (c) 2008 The Ohio State University.

Date: 2008
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Journal Article: What Accounts for the Changes in U.S. Fiscal Policy Transmission? (2008)
Working Paper: What Accounts for the Change in U.S. Fiscal Policy Transmission? (2008)
Working Paper: What Accounts for the Change in U.S. Fiscal Policy Transmission? (2008)
Working Paper: What accounts for the changes in U.S. fiscal policy transmission? (2006)
Working Paper: What Accounts for the Change in U.S Fiscal Policy Transmission ? (2006)
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Persistent link: https://EconPapers.repec.org/RePEc:mcb:jmoncb:v:40:y:2008:i:7:p:1439-1470

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