Dynamic Multipliers in Economics: Results and Interpretation of Calculations on the Example of Russia

The article presents the results of the calculation of dynamic multipliers produced by an increase in public spending in various industries of the Russian economy. The calculations are based on a dynamic input–output model for 72 industries with distributed construction lags. Dynamic multipliers are defined as the ratio of the increase in the gross output of the national economy in the forecast version with an increase in investment or noninvestment spending relative to its value in the version without such an increase to the increase in the corresponding costs. The calculations are performed for the period 2023–2032. It is shown that for investment spending the dynamic multipliers are positive and 2.5–3 times higher than the corresponding static ones for all industries. For noninvestment and total spending, the multipliers are positive for most industries and negative for some. It is also shown that dynamic investment multipliers increase every year, but the growth rate of that increase slows down. The structure of dynamic multiplier effects is considered with a breakdown by sections of the economy corresponding to industrial consumption and to household final consumption. Calculation of dynamic multipliers enables assessment of not only short-term effects of investments, but also accumulated effects of deployment of fixed assets over several years.