Effects of Fiscal Policy (Romer)

What do we know about the effects of fiscal policy? separating evidence from ideology by Christina D. Romer. “Estimating the effects policy may not be rocket science, but it is incredibly hard. The reason that it is hard that fiscal actions are often taken in response to other things happening in the economy. Separating the impact of those other factors from the impact of the tax changes or spending decisions is very difficult. It requires many of the sophisticated techniques in the economist’s tool kit – along with a big dose of creativity, and plenty of plain old-fashioned hard work.”