Publication

The terrorist attacks of September 11 have challenged the view that the US economy is on the brink of recovery. This article discusses the effects of the attacks on real GDP taking the Kiel Institute’s forecast of September 10 as the baseline scenario. The focus is on assessing the direct production losses in the week of September 10–16. Anecdotal evidence is combined with economic reasoning (on the non storability of services, the role of air transports and on the complementarity between services).