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In this seminar, Valerie Ramey will present an overview of her paper “Ten years after the financial crisis: What have we learned from the Renaissance in fiscal research?”
This paper takes stock of what she has learned from the ‘Renaissance’ in fiscal research in the ten years since the financial crisis. Valerie first summarises the new innovations in methodology and discusses the various strengths and weaknesses of the main approaches. Reviewing the estimates, the author comes to the surprising conclusion that the bulk of the estimates for average spending and tax change multipliers lie in a fairly narrow range, 0.6 to 0.8 for spending multipliers and -2 to -3 for tax change multipliers. However, she identifies economic circumstances in which multipliers lie outside those ranges. Valerie concludes by reviewing the debate on whether multipliers were higher on the stimulus spending in the US and the fiscal consolidations in Europe.
Valerie Ramey received her BA in Economics and Spanish from the University of Arizona, graduating summa cum laude, and went on to earn a PhD in Economics from Stanford University. She is currently a Professor of Economics at the University of California, San Diego and a Research Associate of the National Bureau of Economic Research. She is a member of the American Academy of Arts and Sciences. She has served as co-editor of the American Economic Review, chair of the Economics Department at UCSD, and as a member of several National Science Foundation Advisory Panels and the Federal Economic Statistics Advisory Committee. She currently serves on the Panel of Economic Advisers for the Congressional Budget Office and on the NBER Business Cycle Dating Committee, and she is an associate editor of the Quarterly Journal of Economics and the Journal of Political Economy. Professor Ramey has published numerous scholarly articles on the sources of business cycles, trends in wage inequality, the effects of monetary and fiscal policy, the impact of volatility on growth, and links between time use and educational outcomes. She has received research grants from the National Science Foundation, the Alfred P Sloan Foundation, and the Bradley Foundation.