Fiscal multipliers significantly higher at effective lower bound, paper says

The Netherlands Bank

The multipliers for fiscal policy are “significantly higher” when policy rates are at their effective lower bound than when they are not, a working paper published by the Netherlands Bank argues.

In The effects of fiscal policy at the effective lower bound, Dennis Bonam, Jakob de Haan and Beau Soederhuizen use a panel vector autoregression model to analyse quarterly data from 17 advanced economies over the period between 1960 and 2015.

The authors use this model to estimate the effects of gove

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