February 17, 2012

Where Did the Taxpayer Dollars Go? Mercatus Scholars on the Effectiveness of the Stimulus, Three Years Later

Summary

Mercatus scholars have tracked the American Recovery and Reinvestment Act from day one, with a series of new research, one-of-a-kind data, charts, and commentary that document the program’s true performance.

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The American Recovery and Reinvestment Act, which marks its three-year anniversary today, was designed to boost economic growth and create much-needed jobs in a country worn by the financial crisis and recession. But just how effective has the stimulus been at decreasing unemployment and establishing projects that benefit Americans?

Mercatus scholars have tracked the stimulus from day one, with a series of new research, one-of-a-kind data, charts, and commentary that document the program’s true performance. Below are some of our key findings.

No Such Thing as Shovel Ready: The Supply Side of the Recovery Act
Garett Jones and Daniel Rothschild | Working Paper | August 30, 2011
“Looking back, it appears that shovel-ready projects were few and far between.”

Did the Stimulus Dollars Hire the Unemployed? Answers to Questions about the American Recovery and Reinvestment Act
Garett Jones and Daniel Rothschild | Working Paper | August 30, 2011
“[Our study] suggests just how hard it is for Keynesian job creation to work in a modern, expertise-based economy.”

Why the Stimulus Failed: New Research on What Actually Happened to a Trillion Dollars
Featuring Garett Jones and Daniel Rothschild | The Wall Street Journal | September 8, 2011
“In the first paper, the authors survey 85 different businesses, nonprofits and local governments across the country and conclude that 'As is often the case when economic models are transferred from the blackboard to actual public policy, there was a gap between theory and practice.'”

Update: President's Estimates Versus Actual Unemployment After Stimulus
Veronique de Rugy | Chart | February 17, 2012

Freedom is the Key to Creating Jobs, Not Stimulus Spending
Matt Mitchell | US News & World Report | February 7, 2011
“There is a lot of uncertainty surrounding our ability to revive a sick economy, but we do know what makes for a healthy lifestyle: a healthy dose of economic freedom.”

What Can Government Do to Create Jobs?
Matt Mitchell | Congressional Testimony | February 1, 2012
“It is only natural to want to perform emergency surgery on our sick economy but we know from experience that drastic interventions can sometimes cause more harm than good.”

Update: Jobs Loss and Creation Since the Recovery Act
Veronique de Rugy | Chart | August 9, 2010

Federal Infrastructure Spending: Neither a Good Stimulus Nor a Good Investment
Veronique de Rugy | Congressional Testimony | November 16, 2011
“According to economic research, fiscal stimulus can be counterproductive if it is not timely, targeted, and temporary.”

Stimulus Spending and Unemployment: 26 Months After ARRA
Veronique de Rugy | Chart | July 6, 2011

 

The Essential Stimulus: Lessons from the American Recovery and Reinvestment Act of 2009
Veronique de Rugy | Research Summary | September 9, 2011 
"Despite the many promises connected to AARA, the economy hasn't recovered and remains sluggish."

Read more from Mercatus on the stimulus.