… government spending policy shock, we consider a three-variable VAR inspired by Ramey
(2011a), including the SPF fiscal shock, government spending, … where the shock is ordered first …

… for the effects of fiscal policies. Key contributions are … of tax shocks on individual consumption
whereas this paper considers the effects of government spending shocks on consumers. …

… in which heterogeneous households face a borrowing constraint. Temporary tax changes
are found to have large real effects. In the benchmark model, a temporary tax cut increases …

… the effects of monetary policy shocks (conventional and … financial income (both from the
Consumer Expenditure Survey). We find that a conventional expansionary monetary policy shock …

… The importance of the consumer response to fiscal policies is attracting renewed attention
given the large fiscal stimulus packages enacted by governments on both sides of the Atlantic …

… policies. At the heart of this uncertainty lays the recognition that the effects of fiscal policies
… Our analysis on Consumer Expenditure survey (CEX) data leads to four main findings. First, …

… This section develops intuition for the effects of heterogeneity in price stickiness, I/O
linkages, and sectoral size on marginal costs, and the real effects of monetary policy in a log-…

… We find that an expansionary monetary policy shock … ” consumers with a high MPC responding
strongly to income increases, (iii) and heterogeneity in the direct effect of monetary policy …

… consumption heterogeneity has major implications for the impact of monetary policy shocks,
… (2002) or Engel (2011), we show that consumer heterogeneity has important consequences …

… Third, this paper is also related to the vast literature on optimal fiscal policy with
aggregate shocks. Seminal contributions consider a complete-market economy with a representative …