Description |
1 online resource (51 pages) : color illustrations |
Series |
IMF working paper ; WP/16/13 |
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IMF working paper ; WP/16/13.
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Contents |
Cover; Contents; I. Introduction; II. Empirical identification with heterogeneity; A. Identification using panel data; B. Identification using panel data and instrumental variables; C. Identifying instrument: Fuel subsidies and oil price shocks; D. Identifying conditions and estimation; III. Data sources; IV. Results; V. Robustness checks; A. Inference and outliers; B. Instrument validity; VI. Quantile estimates of the fiscal multiplier; VII. Conclusions; References; VIII. Appendix; A. Motivation for heterogeneity; B. Identification and estimation of the CRC model; Tables |
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1. Summary Statistics2. Transition Matrix for Gasoline and Diesel Subsidy; 3. Descriptive Tests for Heterogeneity; 4. Elasticity of GDP to Government Spending: CRC Model Estimates; 5. Fiscal Multiplier Estimates (1/2); 6. Fiscal Multiplier Estimates (2/2); 7. Robustness; 8. Instrument Validity; Figures; 1. Retail price of gasoline and diesel in 2010; 2. Times series plot of international and domestic oil prices; 3. Changes in oil prices and government expenditure by fuel subsidy regime; 4. Quantile estimates of the fiscal multiplier (OLS and IV) |
Summary |
We estimate the average fiscal multiplier, allowing multipliers to be heterogeneous across countries or over time and correlated with the size of government spending. We demonstrate that this form of nonseparable unobserved heterogeneity is empirically relevant and address it by estimating a correlated random coefficient model. Using a panel dataset of 127 countries over the period 1994-2011, we show that not accounting for omitted heterogeneity produces a significant downward bias in conventional multiplier estimates. We rely on both crosssectional and time-series variation in spending shocks, exploiting the differential effects of oil price shocks on fuel subsidies, to identify the average government spending multiplier. Our estimates of the average multiplier range between 1.4 and 1.6. --Abstract |
Notes |
"February 2016." |
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"Research Department." |
Bibliography |
Includes bibliographical references (pages 31-34) |
Notes |
Online resource; title from pdf title page (IMF.org Web site, viewed February 8, 2016) |
Subject |
National income -- Econometric models
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Expenditures, Public -- Econometric models
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Government spending policy -- Econometric models
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Fiscal policy -- Econometric models
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Expenditures, Public -- Econometric models
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Fiscal policy -- Econometric models
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Government spending policy -- Econometric models
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National income -- Econometric models
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Form |
Electronic book
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Author |
Patnam, Manasa, author.
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International Monetary Fund. Research Department, issuing body.
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ISBN |
1498349625 |
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9781498349628 |
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1498389805 |
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9781498389808 |
ISSN |
1018-5941 |
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