Inflationary Effects of Fiscal Support to Households and Firms /
Hale, Galina.
Inflationary Effects of Fiscal Support to Households and Firms / Galina Hale, John C. Leer, Fernanda Nechio. - Cambridge, Mass. National Bureau of Economic Research 2023. - 1 online resource: illustrations (black and white); - NBER working paper series no. w30906 . - Working Paper Series (National Bureau of Economic Research) no. w30906. .
January 2023.
Fiscal support measures in response to the COVID-19 pandemic varied in their targeted beneficiaries. Relying on variability across 10 large economies, we study differences in the inflationary effects of fiscal support measures targeting consumers or businesses. Because conventional measures of real activity were distorted, we control for the underlying state of the real economy using households sentiment data. We find that fiscal support measures to consumers, but not firms, had inflationary effects that manifested 5 weeks following the announcement and peaked at 12 weeks. The magnitude of the effect was larger in an environment of improving consumer sentiment.
System requirements: Adobe [Acrobat] Reader required for PDF files.
Mode of access: World Wide Web.
Price Level • Inflation • Deflation
Fiscal Policy • Modern Monetary Theory
Studies of Particular Policy Episodes
Inflationary Effects of Fiscal Support to Households and Firms / Galina Hale, John C. Leer, Fernanda Nechio. - Cambridge, Mass. National Bureau of Economic Research 2023. - 1 online resource: illustrations (black and white); - NBER working paper series no. w30906 . - Working Paper Series (National Bureau of Economic Research) no. w30906. .
January 2023.
Fiscal support measures in response to the COVID-19 pandemic varied in their targeted beneficiaries. Relying on variability across 10 large economies, we study differences in the inflationary effects of fiscal support measures targeting consumers or businesses. Because conventional measures of real activity were distorted, we control for the underlying state of the real economy using households sentiment data. We find that fiscal support measures to consumers, but not firms, had inflationary effects that manifested 5 weeks following the announcement and peaked at 12 weeks. The magnitude of the effect was larger in an environment of improving consumer sentiment.
System requirements: Adobe [Acrobat] Reader required for PDF files.
Mode of access: World Wide Web.
Price Level • Inflation • Deflation
Fiscal Policy • Modern Monetary Theory
Studies of Particular Policy Episodes