Fiscal Multipliers: Size, Determinants, and Use in Macroeconomic Projections

Nicoletta Batini, Luc Eyraud, Lorenzo Forni and Anke Weber

No 2014/004, IMF Technical Notes and Manuals from International Monetary Fund

Abstract: Fiscal multipliers are important tools for macroeconomic projections and policy design. In many countries, little is known about the size of multipliers, as data availability limits the scope for empirical research. This note provides general guidance on the definition, measurement, and use of fiscal multipliers. It reviews the literature related to their size, persistence and determinants. For countries where no reliable estimate is available, the note proposes a simple method to come up with reasonable values. Finally, the note presents options to incorporate multipliers in macroeconomic forecasts.

Keywords: TNM; spending; government spending; revenue management; spending shock; stance factor; Fiscal policy; fiscal multipliers; fiscal multiplier; multiplier estimate; multipliers in EME; shock effect; Fiscal consolidation; Output gap; Global (search for similar items in EconPapers)
Pages: 33
Date: 2014-10-02
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Citations: View citations in EconPapers (69)

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