Fiscal multipliers

Jim Hamilton reviews some VAR based research on fiscal multipliers. He finds that government spending crowds out private spending, so the fiscal multiplier is less than one.

My view: for most of the sample, the US economy was basically fully employed so this result ought to have been expected. It is not clear that it would hold just now.

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One Response to Fiscal multipliers

  1. On your Marx says:

    don’t disagree .

    some of the comments are quite interesting

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