Great Recession, Slow Recovery and Muted Fiscal Policies in the US
|Title:||Great Recession, Slow Recovery and Muted Fiscal Policies in the US||Authors:||Albonico, Alice
|Permanent link:||http://hdl.handle.net/10197/7609||Date:||Mar-2016||Abstract:||This paper reconsiders the role of macroeconomic shocks and policies in determining the Great Recession and the subsequent recovery in the US. The Great Recession was mainly caused by a large demand shock and by the ZLB on the interest rate policy. In contrast with previous findings, the subsequent jobless recovery is explained by the ZLB effect. We estimate a fraction of non-Ricardian households which is close to 50%, and obtain comparatively large fiscal multipliers. However we cannot detect a significant contribution of fiscal policies in stabilizing the US economy. For instance, the 2007-2009 large increase in expenditure-to-GDP ratios was apparently determined by the adverse non-policy shocks that caused the recession.||Type of material:||Working Paper||Publisher:||University College Dublin. School of Economics||Start page:||1||End page:||39||Series/Report no.:||UCD Centre for Economic Research Working Paper Series; WP2016/02||Keywords:||DSGE; Limited asset market participation; Bayesian estimation; US economy; Business cycle; Monetary policy; Fiscal policy||Language:||en||Status of Item:||Not peer reviewed|
|Appears in Collections:||Economics Working Papers & Policy Papers|
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