Deleidi, Matteo;
(2019)
Public investment fiscal multipliers: An empirical assessment for European countries.
(Working Paper Series: IIPP WP
2019-08).
UCL Institute for Innovation and Public Purpose: London, UK.
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Abstract
This paper aims to estimate fiscal multipliers in 11 Eurozone countries. To do this, we make use of yearly data provided by the OECD for the 1970-2016 period. By using the local projections approach on a panel dataset and considering different model specifications, we estimate the magnitude assumed by fiscal multipliers in order to assess whether an increase in government investment generates a ‘Keynesian effect’ on the level of the GDP. Our findings suggest that fiscal multipliers tend to be larger than one and an increase in public investment produces a permanent and persistent effect on the level of output. Additional model specifications suggest that government investment fiscal multipliers are lower when the post-crisis period is excluded by our sample and are larger in Southern countries than Northern ones.
| Type: | Working / discussion paper |
|---|---|
| Title: | Public investment fiscal multipliers: An empirical assessment for European countries |
| Open access status: | An open access version is available from UCL Discovery |
| Publisher version: | https://www.ucl.ac.uk/bartlett/public-purpose/publ... |
| Language: | English |
| Additional information: | This version is the version of record. For information on re-use, please refer to the publisher’s terms and conditions. |
| Keywords: | Fiscal multipliers; government investment; local projections; euro area |
| UCL classification: | UCL UCL > Provost and Vice Provost Offices > UCL BEAMS UCL > Provost and Vice Provost Offices > UCL BEAMS > Faculty of the Built Environment |
| URI: | https://discovery.ucl.ac.uk/id/eprint/10195925 |
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