Abstract: Proactive fiscal policy is considered to be an important policy tool for stimulating domestic demand and implementing counter-cyclical adjustments. It has played an increasingly critical role in alleviating the current downward pressure on the economy and boosting high-quality development.However, with the increase in fiscal expenditures, the scale of local government debt has risen, and default risks have gathered, which greatly limits the space for active fiscal policy.Based on the fiscal limit theory, this paper uses the dynamic stochastic general equilibrium model to estimate the fiscal multiplier under the possibility of government debt default, and further simulates the effect of fiscal policy implementation.The study found that the fiscal multiplier in the case of a floating exchange rate and a government debt default risk is greater than the fiscal multiplier in the case of a floating exchange rate and no debt default risk, while the situation under a fixed exchange rate is just the opposite.The fiscal multiplier in the case of zero interest rate lower limit is larger than that in normal period, therefore, the estimation result of fiscal multiplier considering the zero interest rate lower limit is more reasonable.This article studies the fiscal multiplier and its influencing factors from the perspective of government debt default risk, and provides an important reference for the future to better play the role of proactive fiscal policy.

Keywords: Debt Default;Risk;Fiscal Multiplier