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Do defense news crowd out private investment?

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  • Karaki, Mohamad B.
  • Safieddine, Hadi

Abstract

This paper studies the effect of U.S. defense news on private U.S. investment. We estimate linear and state-dependent local projection models and find ample evidence that defense news triggers crowding out effects on investment, especially in times of economic slack.

Suggested Citation

  • Karaki, Mohamad B. & Safieddine, Hadi, 2023. "Do defense news crowd out private investment?," Economics Letters, Elsevier, vol. 233(C).
    • Handle: RePEc:eee:ecolet:v:233:y:2023:i:c:s0165176523004470
    DOI: 10.1016/j.econlet.2023.111421
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    References listed on IDEAS

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    More about this item

    Keywords

    Defense news; Investment; Local projection;
    All these keywords.

    JEL classification:

    • E22 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Investment; Capital; Intangible Capital; Capacity
    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy; Modern Monetary Theory

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