Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/208243
Authors: 
Priftis, Romanos
Zimic, Srecko
Year of Publication: 
2018
Series/Report no.: 
ECB Working Paper 2209
Abstract: 
This paper finds that debt-financed fiscal multipliers vary depending on the location of the debt buyer. In a sample of 33 countries fiscal multipliers are larger when government purchases are financed by issuing debt to foreign investors (non-residents), compared to when they are financed by issuing debt to home investors (residents). In a theoretical model, the location of the government creditor produces these differential responses through the extent that private investment is crowded out. International capital mobility of the resident private sector decreases the difference between the two types of financing both in the model and in the data.
Subjects: 
Fiscal multipliers
structural vector autoregressions
sign restrictions
proxy-SVAR
investment crowding in
debt financing
small open-economy model
JEL: 
E62
F41
H3
Persistent Identifier of the first edition: 
ISBN: 
978-92-899-3314-8
Document Type: 
Working Paper

Files in This Item:
File
Size





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.