Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/92811
Authors: 
Ono, Yoshiyasu
Year of Publication: 
2009
Series/Report no.: 
ISER Discussion Paper, Institute of Social and Economic Research, Osaka University 730
Abstract: 
The Keynesian multiplier effect is reinterpreted and several issues that may have misled assessments of the effect of fiscal spending are discussed. It is shown that even in the textbook Keynesian framework some transfer policy 'reduces' aggregate demand and that public works spending may completely crowd out private consumption. Useless public works are found to be equivalent to transfers although they increase accounting national income more than transfers do. The net effect of fiscal spending on national benefits is explored and shown to equal only the direct benefit created by the spending.
Subjects: 
the multiplier effect
public works
unemployment benefits
national income accounting
JEL: 
E12
E62
E01
Document Type: 
Working Paper

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