Did World War II pull America out of the Great Depression?

 [[{“value”:”Maybe by less than people had thought, here is a new ReStat paper by Gillian Brunet: I use newly-digitized contract data on U.S. war production spending over 1940-1945 to analyze the macroeconomic effects of U.S. military spending in World War II. I find personal income multipliers of 0.34 over two years and 0.49 over three
The post Did World War II pull America out of the Great Depression? appeared first on Marginal REVOLUTION.”}]] 

Maybe by less than people had thought, here is a new ReStat paper by Gillian Brunet:

I use newly-digitized contract data on U.S. war production spending over 1940-1945 to analyze the macroeconomic effects of U.S. military spending in World War II. I find personal income multipliers of 0.34 over two years and 0.49 over three years. Personal income multipliers may substantially understate GDP multipliers, perhaps by as much as 50%. Employment estimates imply costs per job-year over the same time horizons of $405,013 and $232,268 in 2015 dollars, suggesting job creation was limited. I also find evidence of negative scale effects: larger positive spending shocks are associated with systematically smaller multiplier estimates.

Via Alexander Berger.  The author’s title is “Stimulus on the Home Front: The State-Level Effects of WWII Spending.”

The post Did World War II pull America out of the Great Depression? appeared first on Marginal REVOLUTION.

 Economics, History, Uncategorized