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been considered in Auerbach et al. (2021) resulting from fixed capacity, or in Michaillat and Saez (2015) arising from search frictions. The model we adopt here has the benefit of being particularly simple [...] findings indicate that our main
5Because the defense spending news series is just available until 2015Q4, the results reported are based on a VAR estimation on this shorter sample.
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0 [...] changes in the United States, American Economic Review 103, 1212-1247. Michaillat, P., and E. Saez (2015), Aggregate Demand, Idle Time, and Unemployment,
Quarterly Journal of Economics 130, 507-569, Miyamoto …