Monthly Archives: October 2009

Why are we in recession?

The spread of the current financial crisis from the US to countries across the globe just showed how interlinked today’s national economies are. The importance of trade and financial flows in such interlinking cannot be overemphasized.  However, what about the linkages emanating from from a global labor market? Does it have anything to do with the current crisis? Ravi Jagannathan and folks have something interesting to say on this.

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More on Government Spending Multipliers

How large is the government spending multiplier? A more recent paper by Christiano et. al. sheds some new light. This paper is more centered on the US. Here is a link for how large is the government multiplier internationally.

A new paper by Cogan et al. finds that the effect of fiscal stimulus is 1/6 th of those estimated by Christina Romer and Bernstein.

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Filed under current economic issues, macroeconomics