@techreport{NBERw6737, title = "Understanding the Effects of a Shock to Government Purchases", author = "Wendy Edelberg and Martin Eichenbaum and Jonas D.M. Fisher", institution = "National Bureau of Economic Research", type = "Working Paper", series = "Working Paper Series", number = "6737", year = "1998", month = "September", URL = "http://www.nber.org/papers/w6737", abstract = {This paper investigates the consequences of an exogenous increase in U.S. government purchases. We find that in response to such a shock, employment, output, and nonresidential investment rise, while real wages, residential investment, and consumption expenditures fall. The paper argues that a simple variant of the neoclassical model which distinguishes between nonresidential and residential investment is consistent with this evidence.}, }