How large are the effects of tax changes?
---- Acknowledgements -----
We thank Daron Acemoglu, Fernando Alvarez, Marios Angeletos, Olivier Blanchard, Eric Leeper, Guido Lorenzoni and Roberto Perotti for helping us clarify the problem we were addressing. We also received very useful comments from participants in seminars at MIT, Boston College, the Federal Reserve Banks of Boston and Chicago and the 2009 Texas Monetary Conference. The views expressed herein are those of the author(s) and do not necessarily reflect the views of the National Bureau of Economic Research.