Category Archives: Stimulus Impact

How to Resolve the Stimulus Debate: Use Data Not the Same Models Over Again

Predictions made in early 2009 about whether the stimulus package would work varied widely because the models used to make the predictions varied widely. Models used by Christy Romer and Jared Bernstein predicted large effects of the 2009 stimulus (ARRA), … Continue reading

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Why the Stimulus Failed to Boost Infrastructure in the US: A Comparison With China

The data are now clear. Despite its large size, the 2009 U.S. stimulus package failed to increase government infrastructure spending or other government purchases as its promoters had claimed it would. The large federal stimulus grants sent to state and … Continue reading

Posted in Stimulus Impact

The Empty Chairs at the ARRA Hearing

Two years ago this week the 2009 stimulus package was enacted into law, and, to examine its effects, the House Committee on Oversight—Subcommittee on Regulatory Affairs held a hearing chaired by Jim Jordan of Ohio and ranking Member Dennis Kucinich … Continue reading

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Models Used for Policy Should Reflect Recent Experience, But Do They?

Data from the Department of Commerce show that short-term stimulus funds did not go to increase federal purchases, or state and local purchases, or even consumption purchases by much over the past few years. Thus the packages did not materially … Continue reading

Posted in Stimulus Impact

Stimulus Math: Many Multiples of Nothing is Still Nothing

In an article in tomorrow’s Wall Street Journal, John Cogan and I review our research showing why the 2009 stimulus package did little to stimulate the economy, despite its large size. The reserch continues our earlier work showing why the … Continue reading

Posted in Stimulus Impact

More Evidence on Why the Stimulus Didn’t Work

Polls show that most Americans don’t believe that the stimulus package worked, but debate continues among economists. The most debated issue is the size of government purchases multiplier. Suppose that the government purchases multiplier is 1.5. Then Economics 1 students … Continue reading

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TV Fiscal Stimulus Debate Reveals Some Agreement

PBS Newshour hosted a live TV debate between Mark Zandi and me yesterday on the question of whether government interventions helped or hurt the economy. The show highlighted a paper by Alan Blinder and Zandi about which I posted comments … Continue reading

Posted in Stimulus Impact