Unpacking the Multiplier: Making Sense of Recent Assessments of Fiscal Stimulus Policy

Unpacking the Multiplier: Making Sense of Recent Assessments of Fiscal Stimulus Policy. Stephen Marglin, September 2013, Paper. "In what follows, we will shed some light on meaning of empirical estimates of the multiplier and their proper use. On the general level, we will undertake a critique of the multiplier, explaining the role that various assumptions play in the three leading methodologies for calculating multiplier values. We find that two types of assumptions are crucial: "counterfactual assumptions" that specify the baseline against which the impact of the stimulus is judged..."