Fiscal multipliers in the COVID19 recession

Alan Auerbach, Yuriy Gorodnichenko, Peter B McCrory and Daniel Murphy

Department of Economics, Working Paper Series from Department of Economics, Institute for Business and Economic Research, UC Berkeley

Abstract: In response to the record-breaking COVID19 recession, many governments have adopted unprecedented fiscal stimuli. While countercyclical fiscal policy is effective in fighting conventional recessions, little is known about the effectiveness of fiscal policy in the current environment with widespread shelter-in-place ("lockdown") policies and the associated considerable limits on economic activity. Using detailed regional variation in economic conditions, lockdown policies, and U.S. government spending, we document that the effects of government spending were stronger during the peak of the pandemic recession, but only in cities that were not subject to strong stay-at-home orders. We examine mechanisms that can account for our evidence and place our findings in the context of other recent evidence from microdata.

Keywords: Clinical Research; Quality Education; COVID19; Fiscal multiplier; Stimulus; Applied Economics; Econometrics; Banking; Finance and Investment; Finance (search for similar items in EconPapers)
Date: 2022-09-01
New Economics Papers: this item is included in nep-pub
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (7)

Downloads: (external link)
https://www.escholarship.org/uc/item/83n8n7j1.pdf;origin=repeccitec (application/pdf)

Related works:
Journal Article: Fiscal multipliers in the COVID19 recession (2022)
Working Paper: Fiscal Multipliers in the COVID19 Recession (2021)
Working Paper: Fiscal Multipliers in the COVID-19 Recession (2021)
Working Paper: Fiscal Multipliers in the COVID19 Recession (2021)
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:cdl:econwp:qt83n8n7j1

Access Statistics for this paper

More papers in Department of Economics, Working Paper Series from Department of Economics, Institute for Business and Economic Research, UC Berkeley Contact information at EDIRC.
Bibliographic data for series maintained by Lisa Schiff ().