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Comparing fiscal multipliers across models and countries in Europe

Grégory de Walque, Massimiliano Pisani, Juha Kilponen, Carlos Thomas, Tibor Hlédik, Samuel Hurtado, Josef Hollmayr, Vesna Corbo, Sebastian Schmidt, Brian Micallef, José Maria, Dimitris Sideris, Matija Lozej, Paulo Júlio, Dmitry Kulikov, Jakub Rysanek (), Dimitris Papageorgiou, Henrik Lundvall and Matthieu Lemoine

No 1760, Working Paper Series from European Central Bank

Abstract: This paper employs fifteen dynamic macroeconomic models maintained within the European System of Central Banks to assess the size of fiscal multipliers in European countries. Using a set of common simulations, we consider transitory and permanent shocks to government expenditures and different taxes. We investigate how the baseline multipliers change when monetary policy is transitorily constrained by the zero nominal interest rate bound, certain crisis-related structural features of the economy such as the share of liquidity-constrained households change, and the endogenous fiscal rule that ensures fiscal sustainability in the long run is specified in terms of labour income taxes instead of lump-sum taxes. JEL Classification: E12, E13, E17, E62, E63

Keywords: fiscal policy; model comparison; output multipliers; zero lower bound (search for similar items in EconPapers)
Date: 2015-03
New Economics Papers: this item is included in nep-eec
Note: 2179645
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Citations: View citations in EconPapers (38)

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