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Livio: I took a quick skim/read of the paper. Interesting. But the one area it seemed to miss was monetary policy. The standard argument for fiscal policy is that it affects aggregate demand. But monetary policy affects aggregate demand too. If the central bank is sensible, it will try to offset the effect of changes in fiscal policy on aggregate demand. So the only thing we will observe will be the central bank's mistakes: the sign of fiscal policy will be positive/negative if the central bank underestimates/overestimates the effect of fiscal policy on AD.

But if the country is part of the Eurozone, or has a fixed exchange rate, we won't get that monetary offset.

Looks like dodgy methodology to me. The results are inherently suspicious: they claim, if you look at the conclusions, that you can have general wage reductions with no reductions in household spending. Seems like cherry-picking of the time scale to me; this can happen in the short run, but is impossible in the several-year run.

The country cherry-picking is, as you noted, also suspicious, since these countries were in a really unusual situation, with a hell of a lot of other things going on.

This paper is very careful to pick its questions in order to get the (ideologically predetermined) conclusions it wanted.

To be fair to them, they admit that their methodology is dodgy and depends on insufficiently many data points to conclude anything.

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