Comparing Fiscal Multipliers Across Models and Countries in Europe

Walque, Grégory de; Pisani, Massimiliano; Kilponen, Juha; Thomas, Carlos; Hledik, Tibor; Hurtado, Samuel; Hollmayr, Josef; Corbo, Vesna; Schmidt, Sebastian; Micallef, Brian; Maria, José R.; Sideris, Dimitris A.; Lozej, Matija; Júlio, Paulo; Kulikov, Dmitry; Ryšánek, Jakub; Papageorgiou, Dimitris; Lundvall, Henrik; Lemoine, Matthieu

doi:10.2139/ssrn.2576673

Cited by 22 publications

(14 citation statements)

References 11 publications

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“…In the long run, the multiplier converges to a value equal to 3.5. The multiplier for grants is found to be lower than 1, with a value of about 0.7 over the period 2021-26, which is within the range of values found in the relevant literature (see among others Kilponen et al 2019). 19 The long-run multiplier for grants is 0.91.…”

Section: Size Of Spending Mutliplierssupporting

confidence: 84%

The impact of the recovery and resilience facility on the Greek economy

Malliaropulos¹,

Papageorgiou²,

Vasardani³

et al. 2021

EconBull

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This paper assesses the macroeconomic impact of the stimulus and the structural reforms supported by the Recovery and Resilience Facility (RRF) on the Greek economy. The set-up is a Dynamic Stochastic General Equilibrium (DSGE) model that is augmented to account for the main features of Greece’s plan under the RRF framework. The results suggest that the full and timely implementation of the Recovery and Resilience Plan (RRP) implies significant benefits to the Greek economy. Real GDP, private investment and employment can potentially increase by 6.9%, 20% and 4%, respectively, by 2026. Tax revenues also increase, creating fiscal space that can be used to further boost economic activity. The implementation of structural reforms included in the RRP is necessary for maintaining important benefits also in the long run. The results indicate that the potential increase in long-run GDP from selected quantifiable reforms ranges between 6% and 9.9%, with gains extending to other macro variables.

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Section: Size Of Spending Mutliplierssupporting

confidence: 84%

The impact of the recovery and resilience facility on the Greek economy

Malliaropulos¹,

Papageorgiou²,

Vasardani³

et al. 2021

EconBull

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“…The literature on Italy also proposes a range of estimates for fiscal multipliers computed implementing different methods. By means of a DSGE model, Kilponen et al (2019) find a first‐year consumption fiscal multiplier of 0.79 and 0.86 assuming a zero lower bound. A first‐year multiplier lower than 1, with no significant differences between government investment and consumption, is also obtained by Carreras et al (2016) using the National Institute Global Econometric Model (NiGEM).…”

Section: Literature Reviewmentioning

confidence: 99%

Quantifying fiscal multipliers in Italy: A Panel SVAR analysis using regional data

Deleidi

Romaniello

Tosi

2021

Papers in Regional Science

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Applying panel SVAR modelling to 1995–2017 regional data, we estimate fiscal multipliers in Italy at national and sub‐national level and find that expansionary fiscal policies produce positive and persistent effects on GDP. Fiscal multipliers remain larger than 1 even 10 years after a discretionary fiscal policy is implemented. Government investment stimulates output more than government consumption. Moreover, fiscal multipliers are higher in Centre‐Northern regions than in Southern ones. Such evidence is confirmed when fiscal foresight is considered. Our findings support the Keynesian perspective, indicating that Italy should increase public investments to foster economic growth especially in the poorest Southern regions.

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“…The resulting weighted average multiplier for expenditure stands at 1.2. This may not be too far off the estimates used by the IMF and the Commission or found elsewhere, as in Kilponen et al (2015), Monokroussos et al (2013). However, what is interesting is that tax multipliers not only are they sizeable compared to those found in mainstream literature, but they are higher than the spending multipliers, as suggested by Romer et al (2010) or Hondroyiannis et al (2015).…”

Section: Estimates Of the Fiscal Multipliersmentioning

confidence: 67%

“…pliers in the same vein. If π= dY dX is the usual impact multiplier of some fiscal variable (X) on GDP (Y), then we may define mKaravitis (1987) 30 For analyses of the methods of estimation, reviews of the types of multipliers and comparison of their size see among othersSpilimbergo et al (2009), Boussard et al (2012), Riera-Crichton et al (2016,Batini et al (2014), ThomasWarmedinger (2015) andKilponen et al (2015). 31 Indicatively, seeGechert et al (2015),Born et al (2015),Eyraud et al (2013) andBoussard et al (2012).…”

mentioning

confidence: 99%

Fiscal Adjustment and Debt Sustainability: Greece 2010-2016 and Beyond

Karavitis

2018

SSRN Journal

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Comparing Fiscal Multipliers Across Models and Countries in Europe

Cited by 22 publications

References 11 publications

The impact of the recovery and resilience facility on the Greek economy

The impact of the recovery and resilience facility on the Greek economy

Quantifying fiscal multipliers in Italy: A Panel SVAR analysis using regional data

Fiscal Adjustment and Debt Sustainability: Greece 2010-2016 and Beyond

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