Thursday, December 11, 2008

On Infrastructure Multipliers at the Local Level

Susan Woodward and Bob Hall say it is probably 1 (a dollar of infrastructure spending increases total spending by a dollar). Marginal Revolution comments here.

I think it is worth mentioning that Charles Tiebout's 1957 doctoral dissertation at Michigan was on local multipliers in Midwestern cities, and he basically found the same result for any exogenous increase in spending.

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