When Is the Government Spending Multiplier Large?

• 成果类型: Article
• 署名作者: Christiano, Lawrence; Eichenbaum, Martin; Rebelo, Sergio
• 署名单位: Northwestern University; National Bureau of Economic Research
• 刊物名称: JOURNAL OF POLITICAL ECONOMY
• ISSN/ISSBN: 0022-3808
• DOI: 10.1086/659312
• 发表日期: 2011
• 页码: 78-121
• 关键词: monetary-policy; shocks; income; output

摘要

We argue that the government-spending multiplier can be much larger than one when the zero lower bound on the nominal interest rate binds. The larger the fraction of government spending that occurs while the nominal interest rate is zero, the larger the value of the multiplier. After providing intuition for these results, we investigate the size of the multiplier in a dynamic, stochastic, general equilibrium model. In this model the multiplier effect is substantially larger than one when the zero bound binds. Our model is consistent with the behavior of key macro aggregates during the recent financial crisis.