Search Results
Journal Article
A primer on the empirical identification of government spending shocks
The empirical literature on the effects of government spending shocks lacks unanimity about the responses of consumption and wages. Proponents of shocks identified by structural vector auto-regressions (VARs) find results consistent with New Keynesian models: consumption and wages increase. On the other hand, proponents of the narrative approach find results consistent with neoclassical models: consumption and wages decrease. This paper reviews these two identifications and confirms their differences by using standard economic series. It also uses alternative measures of government spending, ...
Working Paper
Industry evidence on the effects of government spending
This paper investigates industry-level effects of government purchases in order to shed light on the transmission mechanism for government spending on the aggregate economy. We begin by highlighting the different theoretical predictions concerning the effects of government spending on industry labor market equilibrium. We then create a panel data set that matches output and labor variables to shifts in industry-specific government demand. The empirical results indicate that increases in government demand raise output and hours, but lower real product wages and productivity. Markups do not ...
Report
Deficits, public debt dynamics, and tax and spending multipliers
Cutting government spending on goods and services increases the budget deficit if the nominal interest rate is close to zero. This is the message of a simple but standard New Keynesian DSGE model calibrated with Bayesian methods. The cut in spending reduces output and thus?holding rates for labor and sales taxes constant?reduces revenues by even more than what is saved by the spending cut. Similarly, increasing sales taxes can increase the budget deficit rather than reduce it. Both results suggest limitations of ?austerity measures? in low interest rate economies to cut budget deficits. ...
Journal Article
Veto politics : can a line-item veto reduce spending?
Related link(s): https://www.richmondfed.org/-/media/richmondfedorg/publications/research/econ_focus/2009/spring/feature4_weblinks.cfm
Journal Article
This little piggy came home
Earmarks are plentiful in the Ninth District and vary widely.
Journal Article
Come and get it
Federal spending in district states has increased significantly since the early 1990s.
Report
Correlated disturbances and U.S. business cycles
The dynamic stochastic general equilibrium (DSGE) models used to study business cycles typically assume that exogenous disturbances are independent first-order autoregressions. This paper relaxes this tight and arbitrary restriction by allowing for disturbances that have a rich contemporaneous and dynamic correlation structure. Our first contribution is a new Bayesian econometric method that uses conjugate conditionals to allow for feasible and quick estimation of DSGE models with correlated disturbances. Our second contribution is a reexamination of U.S. business cycles. We find that ...
Journal Article
The foundations and practice of historic preservation
The authors examine historic preservation and show why it serves as an important force in the economy, discussing the motivations for historic preservation and how the practice has evolved, and explaining why government plays a role in preservation and how policy is implemented. Problems created by the competition between preservation and other interests are presented.
Speech
The national and regional economic outlook
Remarks at the University at Albany, Albany, New York.
Speech
The national and regional economic outlook
Remarks before the Bronx Chamber of Commerce at the New York Botanical Garden, Bronx, New York.