Replication data for: A Theory of Countercyclical Government Multiplier
- Michaillat, Pascal
AbstractI develop a New Keynesian model in which a type of government multiplier doubles when unemployment rises from 5 percent to 8 percent. This multiplier indicates the additional number of workers employed when one worker is hired in the public sector. Graphically, in equilibrium, an upward-sloping quasi-labor supply intersects a downward-sloping labor demand in a (employment, labor market tightness) plane. Increasing public employment stimulates labor demand, which increases tightness and therefore crowds out private employment. Critically, the quasi-labor supply is convex. Hence, when labor demand is depressed and unemployment is high, the increase in tightness and resulting crowding-out are small.
Is supplement to
DOI: 10.1257/mac.6.1.190 (Text)
Michaillat, Pascal. “A Theory of Countercyclical Government Multiplier.” American Economic Journal: Macroeconomics 6, no. 1 (January 2014): 190–217. https://doi.org/10.1257/mac.6.1.190.
- ID: 10.1257/mac.6.1.190 (DOI)
Update Metadata: 2020-05-18 | Issue Number: 2 | Registration Date: 2019-10-13