Search Results
Journal Article
Government Spending Might Not Create Jobs Even during Recessions
A review of government spending over 120 years seems to show little, if any, impact on job creation. The result is the same whether the economy is in a recession or not.
Working Paper
Decomposing the Government Transfer Multiplier
We estimate the local, spillover and aggregate causal effects of government transfers on personal income. We identify exogenous changes in federal transfers to residents at the state-level using legislated social security cost-of-living adjustments between 1952 and 1974. Each effect is measured as a multiplier: the change in personal income in response to a one unit change in transfers. The local multiplier, i.e., the effect of own-state transfers on own-state income holding fixed other state's income, at a four-quarter horizon is approximately 3.4. The cross-state spillover multiplier is ...
Journal Article
Which States Are Driving U.S. Employment Growth?
The 2020 CARES Act expanded unemployment insurance benefits for many, but states that opted out early boosted how much they contributed to employment gains.
Briefing
Estimating Aggregate Fiscal Multipliers from Local Data
Variations among regions in their responses to economic policies can be used to estimate the effects of those policies at the national level while minimizing or eliminating issues of reverse causation. Recent research has employed county-level data to look at the effects of federal government spending ? in particular, the 2009?12 stimulus ? on aggregate consumption.
Journal Article
How Recent Fiscal Interventions Compare with the New Deal
Recent attempts to lift the U.S. economy out of the pandemic-induced recession have cost trillions of dollars so far. How does this spending stack up to FDR’s New Deal?
How Quickly Does Fiscal Policy Get Implemented?
The response to the 2007-09 recession can provide a sense of timing when it comes to implementing fiscal policy.
Working Paper
Regional Consumption Responses and the Aggregate Fiscal Multiplier
We use regional variation in the American Recovery and Reinvestment Act (2009-2012) to analyze the effect of government spending on consumer spending. Our consumption data come from household-level retail purchases in the Nielsen scanner data and auto purchases from Equifax credit balances. We estimate that a $1 increase in county-level government spending increases local non-durable consumer spending by $0.29 and local auto spending by $0.09. We translate the regional consumption responses to an aggregate fiscal multiplier using a multiregional, New Keynesian model with heterogeneous agents, ...
Ending Pandemic Unemployment Benefits Linked to Job Growth
A new state-level analysis finds that ending emergency unemployment benefits had a statistically significant positive impact on employment.
Journal Article
Stimulus Spending Had Spillover Effects, Thanks to Commuters
The federal stimulus spending in one county increased employment and wage payments two to three counties away, the authors found in a study of the American Recovery and Reinvestment Act of 2009. The spending spilled over as long as the geographic areas were sufficiently connected, as measured by commuting patterns.
Journal Article
The Recovery Act of 2009 vs. FDR's New Deal: Which Was Bigger?
The American Recovery and Reinvestment Act of 2009 has been called the federal government's largest economic recovery plan. But what about the New Deal? Depending on how the comparison is framed, President Franklin Delano Roosevelt's plan could have been costlier than President Barack Obama's.