Government purchases reloaded : informational insufficiency and heterogeneity in fiscal VARs

Using a large Bayesian VAR, we approximate the flow of information received by economic agents to investigate the effects of changes to government purchases. We document robust evidence that informational insufficiency in conventional models explains inconsistent results across samples and commonly employed identifications in recursive Structural VARs and Expectational VARs. Furthermore, we report heterogeneous effects of components of government purchases. While aggregate government purchases do not appear to produce strong stimulative effects with output multiplier around 0.7, government investment components have multipliers well above unity. State and local consumption, which captures investment in education and health, elicits a strong response

Government Spending Reloaded: Informational Insufficiency and Heterogeneity in Fiscal VARs

Using a large information Bayesian VAR, we approximate the flow of information received by economic agents to investigate the effects of government spending. We document robust evidence that insufficiency of information in conventional models could explain inconsistent results across samples and identifications (Recursive Structural VAR and Expectational VAR). Furthermore, we report heterogeneous effects of government spending components. While aggregate government spending does not appear to produce a strong stimulative effect with output multiplier around 0.7, government investment components have multipliers well above unity. Also, state and local consumption, which captures investment in education and health, elicits a strong response

Government Spending Reloaded: Fundamentalness and Heterogeneity in Fiscal SVARs

Using a large information approach and full Bayesian VAR techniques, we study the economic effects of fiscal policy shocks in the U.S. over the last five decades. We find that omitted variables can explain the well known sample instability of the estimates for the fiscal multiplier. We also find evidence of fiscal foresight and anticipation of the government spending shocks recovered from small Structural VARs (SVARs). Despite incorporating forecasts of government spending, Expectational VARs (EVARs) also show signs of fiscal foresight and anticipation. Conversely, the fiscal shocks recovered from a large information BVAR do not exhibit the same problem. Moreover, large information SVARs and EVARs deliver identical dynamic responses to fiscal shocks. Finally, we report multipliers and impulse response functions for aggregate government spending as well as for components of government spending, and find remarkably heterogeneous responses

Government Spending Reloaded: Informational Insufficiency and Heterogeneity in Fiscal VARs

Using a large information Bayesian VAR, we approximate the flow of information received by economic agents to investigate the effects of government spending. We document robust evidence that insufficiency of information in conventional models could explain inconsistent results across samples and identifications (Recursive Structural VAR and Expectational VAR). Furthermore, we report heterogeneous effects of government spending components. While aggregate government spending does not appear to produce a strong stimulative effect with output multiplier around 0.7, government investment components have multipliers well above unity. Also, state and local consumption, which captures investment in education and health, elicits a strong response

Government Spending Reloaded: Fundamentalness and Heterogeneity in Fiscal SVARs

Using a large information approach and full Bayesian VAR techniques, we study the economic effects of fiscal policy shocks in the U.S. over the last five decades. We find that omitted variables can explain the well known sample instability of the estimates for the fiscal multiplier. We also find evidence of fiscal foresight and anticipation of the government spending shocks recovered from small Structural VARs (SVARs). Despite incorporating forecasts of government spending, Expectational VARs (EVARs) also show signs of fiscal foresight and anticipation. Conversely, the fiscal shocks recovered from a large information BVAR do not exhibit the same problem. Moreover, large information SVARs and EVARs deliver identical dynamic responses to fiscal shocks. Finally, we report multipliers and impulse response functions for aggregate government spending as well as for components of government spending, and find remarkably heterogeneous responses

Government purchases reloaded : informational insufficiency and heterogeneity in fiscal VARs

Using a large Bayesian VAR, we approximate the flow of information received by economic agents to investigate the effects of changes to government purchases. We document robust evidence that informational insufficiency in conventional models explains inconsistent results across samples and commonly employed identifications in recursive Structural VARs and Expectational VARs. Furthermore, we report heterogeneous effects of components of government purchases. While aggregate government purchases do not appear to produce strong stimulative effects with output multiplier around 0.7, government investment components have multipliers well above unity. State and local consumption, which captures investment in education and health, elicits a strong response

The Role of Disclosure and Information Intermediaries in an Unregulated Capital Market: Evidence from Initial Coin Offerings

Using an international sample of 2,113 initial coin offerings (ICOs), we explore the role of disclosure and information intermediaries in the unregulated crypto-tokens market. First, we document substantial cross-sectional variation in the voluntary disclosure practices of ventures seeking to raise capital through ICOs, such as the extent of information released in a prospectus-type document called a white paper; releasing the technical source code; and communicating through social media platforms. Second, we find that, even with limited disclosure verifiability, ventures with higher levels of disclosure have a greater ability to raise capital. Finally, we find that this association is stronger in the presence of mechanisms that lend credibility to ventures' voluntary disclosures, such as internal governance practices or external scrutiny from information intermediaries. Overall, our results suggest that voluntary disclosure and information intermediaries facilitate the functioning of ICOs as an alternative capital market