报告题目：Local and Aggregate Fiscal Policy Multipliers
报告人：William Dupor (Assistant Vice President, the Federal Reserve Bank of St. Louis)
In this paper, we estimate the effect of defense spending on the U.S. macroeconomy since World War II. First, we construct a new panel dataset of state-level federal defense contracts. Second, we sum observations across states and, using the resulting time series, estimate the aggregate effect of defense spending on national income and employment via instrumental variables. Third, we estimate local multipliers using the state-level data, which measures the relative effect on economic activity due to relative differences in defense spending across states. Comparing the aggregate and local multiplier estimates, we find that the two deliver similar results, providing a case in which local multiplier estimates may be reliable indicators of the aggregate effects of fiscal policy. We also estimate spillovers using interstate commodity flow data and find some evidence of small positive spillovers, which explain part of the (small) difference between the estimated local and aggregate multipliers. Across a wide range of specifications, we estimate income and employment multipliers between zero and 0.5. We reconcile this result with the greater-than-one multipliers found in Nakamura and Steinsson (2014) by analyzing the impact of the Korean War episode in the estimation.
William Dupor is Assistant Vice President at the Federal Reserve Bank of St. Louis. His research focuses on Fiscal Policy, Monetary Economics, Macroeconomics and Dynamic Economics. He has published scholarly articles in many journals including, American Economic Review, Journal of Political Economy, Journal of Economic Theory, Journal of Monetary Economics, European Economic Review, and Review of Economics and Statistics. He received his Ph.D. in Economics from the University of Chicago in 1997. He has previously been an assistant professor of finance at the Wharton School, University of Pennsylvania, and an associate professor of economics at the Ohio State University.