Fiscal policy in the aftermath of 9/11
By: Martin Eichenbaum and Jonas Fisher.
Contributors: Fisher, Jonas D. M. 1965-
Series: Working paper series ;; WP-2004-06; Working paper series (Federal Reserve Bank of Chicago. Research Dept. : Online) ;; WP-2004-06.
Publisher: Federal Reserve Bank of Chicago
Published: 2004
Place of publication: [Chicago, Ill.]
Language: eng
Format: Electronic resource
Subjects: Fiscal policy -- United States.; September 11 Terrorist Attacks, 2001.
Description: "This paper investigates the nature of U.S.  fiscal policy in the aftermath of 9/11.  We argue that the recent dramatic fall in the government surplus and the large fall in tax rates cannot be accounted for by either the state of the U.S.  economy as of 9/11 or as the typical response of fiscal policy to a large exogenous rise in military expenditures.  Our evidence suggests that, had tax rates responded in the way they 'normally' do to large exogenous changes in government spending, aggregate output would have been lower and the surplus would not have changed by much.  The unusually large fall in tax rates had an expansionary impact on output and was the primary force underlying the large decline in the surplus.  Our results do not bear directly on the question of whether the decline in tax rates and the decline in the surplus after 9/11 were desirable or not"--Federal Reserve Bank of Chicago web site.
Notes: Also available in print.
Includes bibliographical references.
Title from PDF file as viewed on 9/29/2004.
System requirements: Adobe Acrobat Reader.
Mode of access: World Wide Web.