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Economy and Finance
Scientific paper

Should We Use Linearised Models to Calculate Fiscal Multipliers?


Discussion Paper 064
Publication date
20 July 2017
Directorate-General for Economic and Financial Affairs


A look at the relative merits of linearised and nonlinear dynamic general equilibrium models for calculating government spending multipliers.

DG ECFIN's Fellowship Initiative 2016-2017 “Challenges to integrated markets” culminates and comes to a successful conclusion with the publication of the fellows' contributed papers in our Discussion paper series. Against the background of increasing strains to economic integration at both the global and the European level, the Initiative has brought together a group of outstanding scholars to re-examine integration challenges at the current juncture and to explore the policy options to address these challenges in a discursive interaction process between the group of fellows and Commission services. The research themes of the fellows have spanned a broad area including topics in the political economy of globalisation and integration, issues of macroeconomic policy making at the zero lower interest rate bound, and market integration challenges not least in view of deepening EMU.


Jesper Linde (Sveriges Riksbank) and Mathias Trabandt (Freie Universität Berlin)

Information and identifiers

Discussion Paper 064. July 2017. Brussels. PDF. 48pp. Tab. Graph. Bibliogr. Free.

KC-BD-17-064-EN-N (online)
ISBN 978-92-79-64919-6 (online)
ISSN 2443-8022 (online)
doi:10.2765/393098 (online)

JEL classification: E52, E58.


2017 Fellowship Initiative Papers are written by external experts commissioned to write research papers, retaining complete academic independence, contributing to the discussion on economic policy and stimulating debate.

The views expressed in this document are therefore solely those of the author(s) and do not necessarily represent the official views of the European Commission.

Should We Use Linearised Models to Calculate Fiscal Multipliers?


20 JULY 2017
Should We Use Linearised Models to Calculate Fiscal Multipliers?
(614.87 KB - PDF)