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How Much is Fiscal Consolidation Offset by Increases in Social Safety Net Spending? Evidence from the 2011 Budget Control Act

Timothy M. Komarek et al.

The BE Journal of Economic Analysis and Policy2026https://doi.org/10.1515/bejeap-2025-0073article
AJG 2ABDC A
Weight
0.50

What the paper says

This paper investigates how much reductions in federal procurement spending due to the Budget Control Act of 2011 are offset or “crowded out” by increases in spending on social safety net programs. We use a shift-share instrumental variables approach and find that approximately 7 % of the cuts in federal spending are offset by social safety net transfers. Specifically, for every dollar reduction in federal procurement, there is an increase of $0.06 in unemployment insurance payments and less than $0.01 in SNAP benefits. Furthermore, our analysis reveals that these effects vary significantly with the type of spending that is cut. These findings underscore the broader implications of fiscal adjustments, highlighting the potential consequences for state policies and employer costs.

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https://doi.org/https://doi.org/10.1515/bejeap-2025-0073

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@article{timothy2026,
  title        = {{How Much is Fiscal Consolidation Offset by Increases in Social Safety Net Spending? Evidence from the 2011 Budget Control Act}},
  author       = {Timothy M. Komarek et al.},
  journal      = {The BE Journal of Economic Analysis and Policy},
  year         = {2026},
  doi          = {https://doi.org/https://doi.org/10.1515/bejeap-2025-0073},
}

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Evidence weight

0.50

Balanced mode · F 0.40 / M 0.15 / V 0.05 / R 0.40

F · citation impact0.50 × 0.4 = 0.20
M · momentum0.50 × 0.15 = 0.07
V · venue signal0.50 × 0.05 = 0.03
R · text relevance †0.50 × 0.4 = 0.20

† Text relevance is estimated at 0.50 on the detail page — for your query’s actual relevance score, open this paper from a search result.