Journal Article

What fiscal policy is most effective? A meta-regression analysis

Sebastian Gechert

in Oxford Economic Papers

Volume 67, issue 3, pages 553-580
Published in print July 2015 | ISSN: 0030-7653
Published online March 2015 | e-ISSN: 1464-3812 | DOI: https://dx.doi.org/10.1093/oep/gpv027
What fiscal policy is most effective? A meta-regression analysis

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  • Macroeconomics: Consumption, Saving, Production, Employment, and Investment
  • Fiscal Policies and Behaviour of Economic Agents
  • Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook

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I apply a meta-regression analysis to a unique data set of 104 studies on multiplier effects to derive stylized facts and quantify the differing effectiveness of the composition of fiscal impulses, adjusted for study design characteristics. Public spending multipliers are close to 1 and about 0.3 to 0.4 units larger than tax and transfer multipliers. Public investment multipliers are even larger than those of spending in general by approximately 0.5 unit. Multipliers vary with study design, whose influence should be laid open when drawing policy conclusions. The analysis provides guidance concerning influential factors, their significance, and magnitude.

Keywords: E27; E62; H30

Journal Article.  11758 words.  Illustrated.

Subjects: Macroeconomics: Consumption, Saving, Production, Employment, and Investment ; Fiscal Policies and Behaviour of Economic Agents ; Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook

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