Understanding the effects of a shock to government purchases

Wendy Edelberg, Martin Eichenbaum and Jonas Fisher

No WP-98-7, Working Paper Series from Federal Reserve Bank of Chicago

Abstract: This paper investigates the consequences of an exogenous increase in U.S. government purchase. We find the in response to such a shock, employment, output, and nonresidential investment rise, while real wages, residential investment and consumption expenditures fall. The paper argues that a simple variant of neoclassical growth model which distinguishes between nonresidential and residential investment is consistent with this evidence.

Keywords: Expenditures; Public (search for similar items in EconPapers)
Date: 1998
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Citations: View citations in EconPapers (49)

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Related works:
Journal Article: Understanding the Effects of a Shock to Government Purchases (1999)
Working Paper: Understanding the Effects of a Shock to Government Purchases (1998)
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