News on Asymmetric Fiscal Multipliers

This paper investigates the asymmetric effects of expansionary and contractionary fiscal shocks in the U.S. economy using a state-of-the-art non-linear local projection framework. To identify fiscal shocks, I use a proxy based on revisions to the mean forecast of government spending growth from the Survey of Professional Forecasters, which represent unexpected changes in expectations about government spending. The estimated fiscal multipliers are larger following positive fiscal shocks than following negative ones, indicating asymmetric effects of fiscal policy interventions.

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