Nuremberg Research Seminar in Economics on 14 May 2025, LG 4.154 (!!)
You are invited to join the weekly Nuremberg Research Seminar in Economics on 14 May 2025, from 13.15 to 14.45 pm. The seminar will be held in room LG 4.154 (!!). Ralph Luetticke (University of Tübingen) will be talking about “The Military Multiplier”.
More information can be found here:
What determines the effectiveness of military buildups? We introduce the concept of the military multiplier: the percentage increase in military equipment an additional unit of output buys. It varies with the costs of allocating resources to military production, depending, among other things, on the industrial structure and capital reallocation frictions. We show that the response of military-goods prices to military buildups is a sufficient statistic for the military multiplier and that it has declined over time in the US. Using a calibrated multi-sector business cycle model, we show this decline stems from the economy’s structural shift toward the service sector.