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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