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The import content of expenditure components and the size of international spillovers

Published online by Cambridge University Press:  01 January 2020

Markus Jorra ,
Andreas Esser  and
Ulf D. Slopek
Ulf D. Slopek
Affiliation:
Deutsche Bundesbank, Directorate General Economics
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Abstract

For a large number of countries, we augment the specification of import demand in NiGEM by accounting for different import contents of individual expenditure components. Three examples illustrate that these changes have important implications for model outcomes. In the case of the recently enacted US tax reform and in a ‘hard landing’ scenario for China, spillovers become more pronounced while the domestic effects turn out more muted than in the default specification. The reverse is true for the ramifications of a public investment push in Germany. Hence, we believe that our add-on to NiGEM can be a useful tool for robustness exercises, in particular for spillover studies.

Keywords

NiGEMimport demandimport contentspilloversE37F14F17F44F47
Type
Research Articles
Information
National Institute Economic Review , Volume 244 , May 2018 , pp. R21 - R29
Copyright
Copyright © 2018 National Institute of Economic and Social Research

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Footnotes

The opinions expressed herein are those of the authors and do not necessarily reflect those of the Deutsche Bundesbank. The authors would like to thank Markus Kühnlenz, John Goodall, Johannes Hoffmann and an anonymous referee for their insightful comments.

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