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

Florin Bilbiie, Andre Meier and Gernot 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.

Date: 2008
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Citations: View citations in EconPapers (29)

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https://doi.org/10.1111/j.1538-4616.2008.00166.x

Related works:
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:wly:jmoncb:v:40:y:2008:i:7:p:1439-1470

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