Is Government Spending at the Zero Lower Bound Desirable?

• 成果类型: Article
• 署名作者: Bilbiie, Florin O.; Monacelli, Tommaso; Perotti, Roberto
• 署名单位: University of Lausanne; Center for Economic & Policy Research (CEPR); Bocconi University; Bocconi University
• 刊物名称: AMERICAN ECONOMIC JOURNAL-MACROECONOMICS
• ISSN/ISSBN: 1945-7707
• DOI: 10.1257/mac.20150229
• 发表日期: 2019
• 页码: 147-173
• 关键词: fiscal-policy; nominal rigidities; optimal monetary; unemployment

摘要

We build a medium-scale DSGE model and calibrate it to fit the main macroeconomic variables during the US Great Recession. Using it to evaluate the welfare effects of increasing government consumption at the zero lower bound beyond what was actually observed in the data, we reach three main results. First, the increase in government consumption after 2008, albeit small in present value terms, was close to optimal. Second, frontloading the same stimulus would have been welfare-improving. Third, larger welfare effects occur in our model for parameter values implying either large welfare costs of modest recessions (e.g., high consumption curvature), or outright large recessions.