{
  "title": "AI Meets Fiscal Policy: Mapping Government Spending Actions Across 64 Countries",
  "publication": "IMF Working Papers, March 6, 2026",
  "sourceUrl": "https://www.imf.org/en/publications/wp/issues/2026/03/07/ai-meets-fiscal-policy-mapping-government-spending-actions-across-64-countries-574286",
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  "summary": "We build the first global quarterly narrative database of discretionary government spending actions by applying a fixed GPT–4.1 prompt to Economist Intelligence Unit (EIU) Country Reports.",
  "sections": [
    {
      "heading": "Methodology and Data Construction",
      "content": "- Built the first global quarterly narrative database of discretionary government spending actions by applying a fixed GPT–4.1 prompt to Economist Intelligence Unit (EIU) Country Reports.  \n- Identifies exogenous spending shocks—expansions and contractions—for an unbalanced panel of 64 countries from 1952:Q1 to 2023:Q4.  \n- Uses country-by-country VARs that treat the narrative indicator as an internal instrument to derive comparable cumulative government spending multipliers."
    },
    {
      "heading": "Validation and Robustness Checks",
      "content": "- Database validated by:\n  - Replicating expert narrative coding in Romer and Romer (2019).\n  - Showing that the identified shocks predict subsequent movements in measured government spending.\n  - Establishing alignment with action-based consolidation measures in Adler et al. (2024)."
    },
    {
      "heading": "Main Findings: Fiscal Multipliers",
      "content": "- Derived the first set of comparable cumulative government spending multipliers across countries.\n- Median multiplier is 0.7 at horizons up to two years.\n- Substantial heterogeneity in multipliers across countries and over time."
    },
    {
      "heading": "Heterogeneity and Conditional Patterns",
      "content": "- Pooled estimates imply:\n  - Larger multipliers in less open economies.\n  - Larger multipliers under fixed exchange-rate regimes.\n  - Larger multipliers in downturns.\n- Multipliers are:\n  - Smaller when uncertainty is high.\n  - Larger when political support is stronger.\n\n---\n\n Content in this bundle\n\n- Working Paper\n  - Working Paper (Markdown version){rel=\"alternate\" type=\"text/markdown\"}\n  - Working Paper (PDF){rel=\"external\" type=\"application/pdf\"}\n\n---\n\nSource: https://www.imf.org/en/publications/wp/issues/2026/03/07/ai-meets-fiscal-policy-mapping-government-spending-actions-across-64-countries-574286"
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    "Authors: Shuvam Das, Davide Furceri, Nikhil Patel, Adrian Peralta-Alva",
    "Published: March 6, 2026",
    "Series: IMF Working Papers",
    "DOI: https://doi.org/10.5089/9798229038799.001",
    "Built the first global quarterly narrative database of discretionary government spending actions by applying a fixed GPT–4.1 prompt to Economist Intelligence Unit (EIU) Country Reports.",
    "Identifies exogenous spending shocks—expansions and contractions—for an unbalanced panel of 64 countries from 1952:Q1 to 2023:Q4.",
    "Uses country-by-country VARs that treat the narrative indicator as an internal instrument to derive comparable cumulative government spending multipliers.",
    "Database validated by:",
    "Derived the first set of comparable cumulative government spending multipliers across countries.",
    "Median multiplier is 0.7 at horizons up to two years.",
    "Substantial heterogeneity in multipliers across countries and over time.",
    "Pooled estimates imply:",
    "Multipliers are:",
    "**Working Paper**"
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