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Clearing Up the Fiscal Multiplier Morass: Prior and Posterior Analysis,, NBER Working Paper No. 21433 Issued in July 2015 NBER Program(s): We use Bayesian prior and posterior analysis of a monetary DSGE model, extended to include fiscal details and two distinct monetary-fiscal policy regimes, to quantify government spending multipliers in U.S.

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The combination of model specification, observable data, and relatively diffuse priors for some parameters lands posterior estimates in regions of the parameter space that yield fresh perspectives on the transmission mechanisms that underlie government spending multipliers. Posterior mean estimates of short-run output multipliers are comparable across regimes—about 1.4 on impact—but much larger after 10 years under passive money/active fiscal than under active money/passive fiscal—means of 1.9 versus 0.7 in present value. Supplementary materials for this paper: • Machine-readable bibliographic record -,, Document Object Identifier (DOI): 10.3386/w21433 Published: Eric M.

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Leeper & Nora Traum & Todd B. Walker, 2017.

' American Economic Review, vol 107(8), pages 2409-2454. Users who downloaded this paper also downloaded these: Lafortune, Tessada, and Lewis w21435 Card, Kluve, and Weber w21431 Leeper, Traum, and Walker w17444 Lau and Rosen w21432 Vegh and Vuletin w21436.