Cross-Region Transfers in a Monetary Union : Evidence from the US and Some Implications

Cross-Region Transfers in a Monetary Union : Evidence from the US and Some Implications

US federal transfers to individuals are large, countercyclical, vary geographically, and are often credited for helping stabilize regional economies. This paper estimates the short-run effects of these transfers using plausibly exogenous regional v...

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Bibliographic Details
Main Author: Pennings, Steven
Format: Working Paper
Language:English
Published: World Bank, Washington, DC 2020
Subjects:
FISCAL MULTIPLIER
FISCAL TRANSFER
MONETARY UNION
FEDERAL TRANSFERS
REGIONAL DEVELOPMENT
STIMULUS PACKAGE
NEW KEYNESIAN MODEL
REGIONAL STABILIZATION
CORONAVIRUS
COVID-19
PANDEMIC RESPONSE
COUNTERCYCLICAL POLICY
Online Access:http://documents.worldbank.org/curated/en/486411589304789870/Cross-Region-Transfers-in-a-Monetary-Union-Evidence-from-the-US-and-Some-Implications
http://hdl.handle.net/10986/33756
id okr-10986-33756
recordtype oai_dc
spelling okr-10986-337562022-09-20T00:12:49Z Cross-Region Transfers in a Monetary Union : Evidence from the US and Some Implications Pennings, Steven FISCAL MULTIPLIER FISCAL TRANSFER MONETARY UNION FEDERAL TRANSFERS REGIONAL DEVELOPMENT STIMULUS PACKAGE NEW KEYNESIAN MODEL REGIONAL STABILIZATION CORONAVIRUS COVID-19 PANDEMIC RESPONSE COUNTERCYCLICAL POLICY US federal transfers to individuals are large, countercyclical, vary geographically, and are often credited for helping stabilize regional economies. This paper estimates the short-run effects of these transfers using plausibly exogenous regional variation in temporary stimulus packages and earlier permanent Social Security increases. States that received larger transfers tended to grow faster contemporaneously, with a multiplier of around 1.5 for permanent transfers and 1/3 for temporary transfers. Results are broadly consistent with an open-economy New Keynesian model. At business-cycle frequencies, cross-region transfer multipliers are not large, suggesting only modest gains in regional stabilization from US federal automatic stabilizers. 2020-05-14T21:03:13Z 2020-05-14T21:03:13Z 2020-05 Working Paper http://documents.worldbank.org/curated/en/486411589304789870/Cross-Region-Transfers-in-a-Monetary-Union-Evidence-from-the-US-and-Some-Implications http://hdl.handle.net/10986/33756 English Policy Research Working Paper;No. 9244 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo World Bank World Bank, Washington, DC Publications & Research Publications & Research :: Policy Research Working Paper United States
repository_type Digital Repository
institution_category Foreign Institution
institution Digital Repositories
building World Bank Open Knowledge Repository
collection World Bank
language English
topic FISCAL MULTIPLIER
FISCAL TRANSFER
MONETARY UNION
FEDERAL TRANSFERS
REGIONAL DEVELOPMENT
STIMULUS PACKAGE
NEW KEYNESIAN MODEL
REGIONAL STABILIZATION
CORONAVIRUS
COVID-19
PANDEMIC RESPONSE
COUNTERCYCLICAL POLICY
spellingShingle FISCAL MULTIPLIER
FISCAL TRANSFER
MONETARY UNION
FEDERAL TRANSFERS
REGIONAL DEVELOPMENT
STIMULUS PACKAGE
NEW KEYNESIAN MODEL
REGIONAL STABILIZATION
CORONAVIRUS
COVID-19
PANDEMIC RESPONSE
COUNTERCYCLICAL POLICY
Pennings, Steven
Cross-Region Transfers in a Monetary Union : Evidence from the US and Some Implications
geographic_facet United States
relation Policy Research Working Paper;No. 9244
description US federal transfers to individuals are large, countercyclical, vary geographically, and are often credited for helping stabilize regional economies. This paper estimates the short-run effects of these transfers using plausibly exogenous regional variation in temporary stimulus packages and earlier permanent Social Security increases. States that received larger transfers tended to grow faster contemporaneously, with a multiplier of around 1.5 for permanent transfers and 1/3 for temporary transfers. Results are broadly consistent with an open-economy New Keynesian model. At business-cycle frequencies, cross-region transfer multipliers are not large, suggesting only modest gains in regional stabilization from US federal automatic stabilizers.
format Working Paper
author Pennings, Steven
author_facet Pennings, Steven
author_sort Pennings, Steven
title Cross-Region Transfers in a Monetary Union : Evidence from the US and Some Implications
title_short Cross-Region Transfers in a Monetary Union : Evidence from the US and Some Implications
title_full Cross-Region Transfers in a Monetary Union : Evidence from the US and Some Implications
title_fullStr Cross-Region Transfers in a Monetary Union : Evidence from the US and Some Implications
title_full_unstemmed Cross-Region Transfers in a Monetary Union : Evidence from the US and Some Implications
title_sort cross-region transfers in a monetary union : evidence from the us and some implications
publisher World Bank, Washington, DC
publishDate 2020
url http://documents.worldbank.org/curated/en/486411589304789870/Cross-Region-Transfers-in-a-Monetary-Union-Evidence-from-the-US-and-Some-Implications
http://hdl.handle.net/10986/33756
_version_ 1764479450925236224

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