{
  "title": "Does Government Spending Crowd In Private Consumption? Theory and Empirical Evidence for the Euro Area",
  "publication": "IMF Working Papers, August 1, 2005",
  "sourceUrl": "https://www.imf.org/en/publications/wp/issues/2016/12/31/does-government-spending-crowd-in-private-consumption-theory-and-empirical-evidence-for-the-18359",
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  "summary": "In this paper, we revisit the effects of government spending shocks on private consumption within an estimated New-Keynesian DSGE model of the euro area featuring non-Ricardian households.",
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    {
      "heading": "Study overview and methodology",
      "content": "- Authors: Günter Coenen, Roland Straub\n- Publication date: August 1, 2005\n- Paper type: IMF Working Papers, Working Paper No. 2005/159\n- Model and methods:\n  - Estimated New-Keynesian DSGE model of the euro area.\n  - Model features non-Ricardian households.\n  - Estimation and inference conducted using Bayesian inference methods."
    },
    {
      "heading": "Main findings",
      "content": "- Presence of non-Ricardian households:\n  - Is in general conducive to raising the level of consumption in response to government spending shocks when compared with the benchmark specification without non-Ricardian households.\n- Probability of crowding-in:\n  - There is only a fairly small chance that government spending shocks crowd in consumption.\n- Reasons for limited crowding-in:\n  - The estimated share of non-Ricardian households is relatively low.\n  - A large negative wealth effect is induced by the highly persistent nature of government spending shocks."
    },
    {
      "heading": "Subjects and keywords",
      "content": "- Subject: Consumption, Disposable income, Expenditure, Fiscal policy, Labor\n- Keywords: government spending, WP\n\n---\n\n Content in this bundle\n\n- Wp05159\n  - Wp05159 (Markdown version){rel=\"alternate\" type=\"text/markdown\"}\n  - Wp05159 (PDF){rel=\"external\" type=\"application/pdf\"}\n\n---\n\nSource: https://www.imf.org/en/publications/wp/issues/2016/12/31/does-government-spending-crowd-in-private-consumption-theory-and-empirical-evidence-for-the-18359"
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    "Authors: Günter Coenen, Roland Straub",
    "Published: August 1, 2005",
    "Series: IMF Working Papers",
    "DOI: https://doi.org/10.5089/9781451861785.001",
    "Authors: Günter Coenen, Roland Straub",
    "Publication date: August 1, 2005",
    "Paper type: IMF Working Papers, Working Paper No. 2005/159",
    "Model and methods:",
    "Presence of non-Ricardian households:",
    "Probability of crowding-in:",
    "Reasons for limited crowding-in:",
    "Subject: Consumption, Disposable income, Expenditure, Fiscal policy, Labor",
    "Keywords: government spending, WP",
    "**Wp05159**"
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