Table 3.
Recessionary (1995–2010) and pre-recession fiscal multipliers (1995–2007), by type of government spending
| |
Increase in GDP (PPP, per capita, real) |
||
|---|---|---|---|
| Covariates | Estimated multiplier 1995-2010 | Recession interaction | Estimated recession multiplier |
| |
(1) |
(2) |
(3) |
| Total Government Spending |
1.28 |
−0.15 |
1.13 |
| (0.78 to 1.77) |
(−0.084 to −0.21) |
(0.66 to 1.61) |
|
| Defence |
−5.69 |
−1.71 |
−7.40 |
| (−15.77 to 4.39) |
(−6.16 to 2.74) |
(−18.12 to 3.32) |
|
| Community |
−2.29 |
−5.99 |
−8.29 |
| (−4.84 to 0.25) |
(−1.34 to −10.64) |
(−13.45 to −3.12) |
|
| Economic Affairs |
0.45 |
−1.17 |
−0.72 |
| (−0.35 to 1.24) |
(−1.99 to −0.35) |
(−1.09 to −0.35) |
|
| General Public Services |
1.57 |
−0.45 |
1.12 |
| (−0.26 to 3.40) |
(−1.17 to 0.28) |
(−0.75 to 3.00) |
|
| Social Protection |
3.04 |
−0.33 |
2.71 |
| (2.05 to 4.03) |
(−0.56 to −0.11) |
(1.81 to 3.60) |
|
| Health |
4.92 |
−1.31 |
3.61 |
| (2.92 to 6.93) |
(−1.68 to −0.94) |
(1.60 to 5.62) |
|
| Culture & Recreation |
14.12 |
−2.38 |
11.83 |
| (2.16 to 26.26) |
(−0.67 to −4.10) |
(−0.92 to 24.58) |
|
| Education |
9.37 |
−1.44 |
7.92 |
| (4.40 to 14.34) |
(−2.08 to −0.80) |
(3.19 to 12.66) |
|
| Environment |
9.49 |
−6.30 |
3.18 |
| (−5.03 to 24.00) | (−8.93 to −3.68) | (−10.60 to 16.97) | |
Notes: Numbers in parentheses are 95% confidence intervals. GDP and all forms of government spending are adjusted for inflation and purchasing-power parity. Robust standard errors in parentheses clustered by country to reflect non-independence of sampling Columns 1–2 report coefficients from equation 2. Column 3 reports the linear combination of columns 1 and 2. All models control for between-country variation.