The federal demand in SC is about $16.2B., about 1/2 is military wages. In a "technical" shut down is it this demand that goes away? Clearly the time assumption is critical here; will it be short term, will the new budget become retroactive, too short to notice, etc. To model this however, is it best to take take the detailed demand and subtract out of an economy based on the Federal gov't operating budget expenditures spending patterns (non-defence, defence etc) or is there a better method? What brought this to my attention is real estate persons saying they can't close on some homes since the gov't is shut down. But when one does an impact on real estate, federal govt does not show up in the impacts. In the spending pattern there is of course 'monetary authorities' which may provide a proxy for federal gov't, but it is not clear to me if this adjustment would capture a govt "shutdown"? Alternatively, is there a way to model the shock through industry change like in the case of real estate or back out federal demand? Thank you.
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