Fiscal Multipliers in the COVID19 Recession

Alan Auerbach, Yuriy Gorodnichenko, Peter McCrory and Daniel Murphy ()

No 29531, NBER Working Papers from National Bureau of Economic Research, Inc

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.

JEL-codes: E32 E62 H3 (search for similar items in EconPapers)
Date: 2021-12
New Economics Papers: this item is included in nep-mac and nep-ure
Note: EFG ME
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Citations: View citations in EconPapers (6)

Published as Alan Auerbach & Yuriy Gorodnichenko & Daniel Murphy & Peter B. McCrory, 2022. "Fiscal Multipliers in the COVID19 Recession," Journal of International Money and Finance, .

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Journal Article: Fiscal multipliers in the COVID19 recession (2022)
Working Paper: 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)
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