Gechert, SebastianPaetz, ChristophVillanueva Cortés, Paloma2024-02-012024-02-012021Gechert S, Paetz C, Villanueva P (2021) The macroeconomic effects of social security contributions and benefits. Journal of Monetary Economics, 117, 571-584, https://doi.org/10.1016/j.jmoneco.2020.03.0120304-393210.1016/j.jmoneco.2020.03.012https://hdl.handle.net/20.500.14352/97503A narrative dataset of legislative social security shocks is constructed for Germany. The dataset covers major legal changes in benefits and contributions from 1970 to 2018. We estimate their macroeconomic effects in a proxy SVAR. The GDP response to a cut in contributions yields a fiscal multiplier of about 0.4 on impact that fades relatively quickly. For benefit increases the impact multiplier is 1.1 and more persistent. The response of other macro variables suggests that benefits work through a strong demand-side channel, while contributions exhibit supply-side effects. Combining the shocks with household data confirms a strong consumption response of beneficiaries.engAttribution-NonCommercial-NoDerivatives 4.0 Internationalhttp://creativecommons.org/licenses/by-nc-nd/4.0/journal articlehttps://doi.org/10.1016/j.jmoneco.2020.03.012https://www.sciencedirect.com/science/article/pii/S0304393220300416open accessE62H20H30Narrative approachFiscal multiplierSocial securityMPC HeterogeneityMacroeconomíaMicroeconomía5304.08 Redistribución5308 Economía General