著者

Willi Semmler Alexander Haider Andreas Lichtenberger

出版者

The Keynes Society Japan

雑誌

The Review of Keynesian Studies (ISSN:24356581)

巻号頁・発行日

vol.2, pp.78-121, 2020 (Released:2021-04-24)

参考文献数

70

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The multiplier effect of fiscal spending has long been an object of study. The great recession of 2007-9 and the US fiscal stimulus program revived empirical studies on the multiplier, showing the wide range its value can take. This paper explores the effects of the fiscal multiplier in the context of a Keynesian business cycle theory, emphasizing the regime dependence of the multiplier. It is, as Keynes, Minsky and Kindleberger suggest, the state of the business cycle, the flow of credits, financial fragility and financial stress that are of importance for the size of the fiscal multiplier. But the multiplier effect is also essentially dependent on the monetary policy stance, which affects the financial stress, the interest rate and risk premia. Thus, one can observe that the size of multiplier is not only dependent on the state of the business cycle, financial fragility and financial stress, but also subject to the extent of fiscal action as well as the accompanying type of monetary policy. Lastly, human behavior driven by uncertainties about the future, as holds for the recent Pandemic Recession, can also significantly affect the fiscal multiplier.