转移支付社会保障和宏观经济外文文献翻译.docx

转移支付社会保障和宏观经济外文文献翻译.docx

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转移支付社会保障和宏观经济外文文献翻译

转移支付、社会保障和宏观经济中英文2016

英文

TransferPaymentsandtheMacroeconomy:

TheEffectsofSocialSecurityBenefitIncreases,1952–1991

ChristinaRomer,DavidRomer

ThispaperusesSocialSecuritybenefitincreasesfrom1952to1991toinvestigatethemacroeconomiceffectsofchangesintransfers.Itfindsalarge,immediate,andsignificantpositiveresponseofconsumptiontopermanentbenefitincreases.Theresponsedeclinesafteraboutfivemonths,anddoesnotappeartospreadtoindustrialproductionoremployment.Theeffectsoftransfersarefaster,butmuchlesspersistentandmuchsmalleroverall,thanthoseoftaxchanges.Finally,monetarypolicyrespondsstronglytobenefitincreasesbutnottotaxchanges.Thismayaccountforthefailureoftheeffectsoftransferstopersistorspread.

Governmenttransferpaymentsaretherelativeunknownsoffiscalpolicy.Therehavebeenmanystudiesoftheshort-runmacroeconomiceffectsofchangesingovernmentpurchasesandtaxes,butmuchlessresearchhasbeendoneontheaggregateimpactsoftransferpayments.Yetsuchpaymentsaresubstantial.IntheUnitedStatestoday,forexample,federaltransferpaymentsaccountforabout15 percentofGDPandmorethan40percentoffederalspending.ThispapertakesasteptowardfillingthisgapinourknowledgebyexaminingthemacroeconomicimpactofincreasesinSocialSecuritybenefitsintheUnitedStatesfrom1952to1991.Formuchofthepostwarperiod,increasesinSocialSecuritybenefitsoccurredsomewhatrandomly.Thegenerosityoftheprogramwasexpandedinseveralstepsduringthe1950sand1960s.Until1974,cost-of-livingincreaseswerenotautomatic,butwerelegislatedatirregularintervals.Andfrom1975untiltheearly1990s,substantialvariationininflationandoccasionalburstsofretroactivepaymentsresultingfromidiosyncraticfactors,aswellasalegislatedchangeinthetimingofcost-of-livingadjustments,ledtoirregularandvariablebenefitchanges.ThisvariationmakesSocialSecuritybenefitincreasesapotentiallyfruitfulwindowintothemacroeconomiceffectsoftransfers.

WeusedocumentsfromtheSocialSecurityAdministration,Congress,andtheexecutivebranchtoidentifythenature,motivation,timing,andsizeofbenefitincreasesoverthesedecades.Thisnarrativeanalysisallowsustofocusonincreasesthatraisedpaymentstoexistingbeneficiaries,toexcludethefewincreasesthatwereexplicitlymadeforcountercyclicalpurposes,andtoseparatepermanentandtemporarychanges.

WethenestimatehowaggregateconsumerspendingrespondstotheserelativelyexogenousincreasesinSocialSecuritybenefits.Wefindthatpermanentbenefitincreaseshavearoughlyone-for-oneimpactonconsumerspendinginthemonththelargerchecksarrive,andthatthiseffectishighlystatisticallysignificant.Theeffectpersistsforroughlyhalfayearandthenappearstowanesharply—thoughthestandarderrorsbecomelargeatlongerhorizons.Interestingly,wefindthattemporarybenefitincreases（whichmainlytooktheformofone-timeretroactivepaymentsintheperiodweconsider）haveamuchsmallerimpactonconsumption.Neitherpermanentnortemporaryincreasesinbenefitsappeartoaffectbroadermeasuresofeconomicactivity,suchasindustrialproductionoremployment.

Insomemodelsofmacroeconomicbehavior,taxesandtransfershaveequalandoppositeeffectsonhouseholdconsumptionandoveralleconomicactivity.Tocom-paretheeffectsoftaxesandtransfers,weexpandouranalysistoalsoincludetherelativelyexogenousfederaltaxchangesidentifiedinRomerandRomer（2010）.LikethepermanentSocialSecuritybenefitincreases,thesetaxchangeswerealmostalllegislatedtobeverylong-lasting.Wefindlargedifferencesintheresponseofconsumptiontoapermanentbenefitincreaseandataxcut.Theeffectsofabenefitincreasearefaster,butmuchlesspersistentandsubstantiallysmalleroverall.Inbothcases,themaincomponentofconsumptionthatrespondsispurchasesofdurablegoods.

Onepossibleexplanationfortheseeminglyshort-livedresponseofconsumptiontoapermanentbenefitincrease,andthecontrastwiththeimpactofataxcut,involvestheresponseofmonetarypolicy.Wethereforeexaminebothstatisticalandnarrativeevidenceonthemonetarypolicyreaction.Wefindthatthefederalfundsraterisesinresponsetoabenefitincrease,andtheeffectisveryfast,economicallylarge,andhighlystatisticallysignificant.Followinganexogenoustaxcut,incon-trast,thefederalfundsratefallsslightlyoverthefirstyear.TherecordsofFederalReservepolicydiscussionsrevealthatpolicymakerswereveryawareofthebenefitincreasesandoftenviewedthemasareasontotightenmonetarypolicy.Incontrast,monetarypolicymakersweremuchlessconsistentinadvocatingforcounteractingthelikelyimpactsoftaxchangesonaggregatedemand.

Themostimportantlimitationofourstudyissimplythattheamountofidentifyingvariationthatweareabletoexploitisonlymoderate.IncreasesinSocialSecuritybenefitsaresmallrelativetothelargechangesingovernmentpurchasesassociatedwithmajorwars,andtheyarenoticeablysmallerthanthetaxchangesthatarethefocusofRomerandRomer（2010）.Ourdetailedinformationaboutthemonthlytimingofbenefitincreasesallowsustopindowntheireffectsintheveryneartermrelativelyprecisely.Butonceweconsiderhorizonsbeyondafewmonths,thelimitedamountofvariationoftenyieldsconfidenceintervalsthatarewideenoughtoencompassarangeofeconomicallyinterestinghypotheses.Thus,thispaperisonlyafirststepintryingtounderstandthemacroeconomiceffectsofgovernmenttransferpayments.

Ourpaperbuildsonandspeakstoarangeofliteratures.Manypapersexaminetheresponseofindividualstoparticularchangesinincome.Mostfindthataslongasthechangesarenotlarge,individualsrespondtothemwhentheyoccur,eveniftheycouldhaveknownabouttheminadvanceortheirimpactonlifetimeresourcesissmall.Importantly,althoughthisindividual-levelevidenceissuggestiveofamacroeconomicimpactofchangesintransfers,therecouldbeoffsettingforcesattheaggregatelevel.Forexample,therecouldbeRicardian-equivalenceeffects:

theadverseimplicationsforlifetimewealthofthehigherfuturetaxesneededtofinanceanincreaseintransferscouldexertadownwardinfluenceonallindividuals’consumption.Likewise,therecouldbeoffsettingeffectsonaggregateconsumptionthroughhigherinterestrates,reducedconfidenceaboutgovernmentpolicy,orincreaseduncertaintyaboutpolicy.Thus,afindingthatindividualswhoreceiveapaymentraisetheirconsumptionrelativetoindividualswhodonotisinsufficienttoestablishthatchangesintransfershaveimportantmacroeconomiceffects.Itisthereforeimportanttolookdirectlyataggregateevidence.

Likeus,Wilcox（1989）looksattheresponseofaggregateconsumptiontoSocialSecuritybenefitincreases.Likemuchoftheindividual-levelliterature,however,hisfocusisonthepermanentincomehypothesis:

sincethebenefitincreasesareannouncedinadvance,thehypothesisimpliesthatconsumptionshouldnotrespondtotheirimplementation.Heshowsthatovertheperiod1965–1985,theimmediateimpactofpermanentbenefitincreasesonrealretailsalesandpersonalconsumptionexpendituresispositiveandstatisticallysignificant.Becauseourinterestisinthemacroeconomiceffectsofchangesintransfersmorebroadly,weusenarrativesourcestoconstructalongersampleofbenefitincreases,andtoidentifyandomitthefewthatweremadeinresponsetoshort-runmacroeconomicdevelopments.Inourempiricalanalysis,wefocusonthemagnitudeoftheeffectsofbenefitincreasesratherthanjustwhethertheyarenonzero,examinewhethertheimpactpersistsandwhetheritspreadstobroaderindicatorsofeconomicactivity,andcomparetheeffectsofpermanentandtemporarybenefitchanges.Wegoontocomparetheeffectsoftransfersandtaxchanges,andtoinvestigatetheresponseofmonetarypolicy.WhilewereplicateWilcox’sfindingofastrongimmediateimpactofpermanentbenefitincreasesonconsumption,wefindthattheeffectsdisappearrelativelyquicklyanddonotspread,andweprovideevidencethatcounteractingmonetarydevelopmentslikelyexplainmuchofthisbehavior.

Ourpaperisclearlyrelatedtorecentworkonthemacroeconomiceffectsofchangesinfiscalpolicy.Thesepapersusebothtime-seriesevidenceandcross-statevariation.Whilethisliteraturehasgenerallyfoundasignificantpositiveimpactoffiscalexpansion,theimpliedfiscalmultipliersdiffersubstantiallyinbothsizeandtiming.Ourpaperprovidesanotherestimateoftheeffectoffiscalpolicy,usingatypeoffiscalchangewhosetimingisrelativelyexogenousandcanbeidentifiedquiteaccurately.

Finally,muchrecentresearchhasfocusedontheimportanceofmonetarypol-icyfortheeffectsoffiscalpolicy（forexample,Leighetal.2010;Christiano,Eichenbaum,andRebelo2011;Woodford2011;andNakamuraandSteinsson2014）.OurstudyprovidesbothstatisticalandnarrativeevidenceofalinkbetweenSocialSecuritybenefitincreasesandcontractionarymonetarypolicy,andofdifferentmonetarypolicyresponsestochangesintransfersandtaxes.

IdentifyingSocialSecurityBenefitIncreases

AcentralgoalofthepaperistouseSocialSecuritybenefitincreasestoexaminehowconsumptionandothermacroeconomicvariablesrespondtochangesintrans-ferpayments.Thus,acriticalstepistoidentifyasetofbenefitincreasesthatareusefulforthispurpose.

A.GeneralConsiderations

ThereexistmonthlydataonaggregateSocialSecuritypaymentsintheNat