Fiscal multipliers in turbulent times: the case of Spain
- Autores: Pablo Hernández de Cos, Enrique Moral-Benito
- Localización: XXI Encuentro Economía Pública, 2014, pág. 70
- Idioma: inglés
- Enlaces
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Resumen
What are the output responses to scal policy? Despite important contributions have been made in the literature, quantifying the size of the scal multiplier remains a challenge.
Indeed, the challenge of estimating a unique scal multiplier is probably an ill-posed one. The magnitude of the multiplier may well depend on country- and time-speci c characteristics of the scal stance under scrutiny. In this paper, we estimate state-speci c multipliers for Spain depending on the state of the economy along several dimensions. The government spending multiplier is estimated to be larger during recessions and banking stress periods, but much smaller (or even negative) during periods of weak public nances. Combining these three dimensions into a single global turmoil indicator via principal component analysis, the estimated multipliers are 1.4 for crisis (or turbulent) times and 0.6 for tranquil times.
JEL Codes: E62, H30.