Military expenditure and economic growth, 1960–2014

Authors

  • J. Paul Dunne Department of Economics, University of Cape Town, Cape Town
  • Nan Tian Southern Africa Labour and Development Research Unit (SALDRU), University of Cape Town, Cape Town, South Africa

DOI:

https://doi.org/10.15355/epsj.11.2.50

Keywords:

Military expenditure growth, SIPRI data

Abstract

This article compares results of our 2015 study of the effect of military expenditure on economic growth, 1988–2010, with results using an additional 28 years of data provided in the newly revised and extended SIPRI dataset, 1960–2014. When the additional data points are added, we find no substantive differences and confirm the statistically significant negative effect of military expenditure on growth reported in our prior research. Using the same estimation process, there is no evidence of a structural break in the time series. Considering nonlinearity and heterogeneity, the estimates using the new data for ninety-seven countries are remarkably consistent with the earlier results and, overall, are very similar in sign and statistical significance, and many of the coefficients are larger (more adverse) than before. The new data provide valuable extra information and support for the original findings.

References

Alexander, W.R.J. 2013. “Military Spending and Economic Growth in South Asia: Comment and Reconsideration.” Defence and Peace Economics. Vol. 24, No. 2, pp. 173–178. http://dx.doi.org/10.1080/10242694.2012.679832

Alptekin, A. and P. Levine. 2012. “Military Expenditure and Economic Growth: A Meta-Analysis.” European Journal of Political Economy. Vol. 28, No. 4, pp. 636–650. http://dx.doi.org/10.1016/j.ejpoleco.2012.07.002

Benoit, E. 1973. Defense and Growth in Developing Countries. Boston: Lexington Books.

Compton, R.A. and B. Paterson. 2015. “Military Spending and Growth: The Role of Institutions.” Defence and Peace Economics. Vol. 27, No. 2, pp. 301–322.

Dunne, J.P. 1996. “Economic Effects of Military Expenditure in Developing Countries: A Survey,” pp. 439–464 in N.P. Gleditsch, A. Cappelen, O. Bjerkholt, R.P. Smith, and J.P. Dunne, eds. The Peace Dividend. Amsterdam: North Holland. http://dx.doi.org/10.1108/S0573-8555(1996)0000235025

Dunne, J.P., R.P. Smith, D. Willenbockel. 2005. “Models of Military Expenditure and Growth: A Critical Review.” Defence and Peace Economics. Vol. 16, No. 6, pp. 449– 461. http://dx.doi.org/10.1080/10242690500167791

Dunne, J.P. and M. Uye. 2010. “Military Spending and Development,” pp. 293–305 in A. Tan, ed. The Global Arms Trade: A Handbook. London: Europa/Routledge.

Dunne, J.P. and N. Tian. 2013. “Military Expenditure and Economic Growth: A Survey.” Economics of Peace and Security Journal. Vol. 8, No. 1, pp. 5–11. http://dx.doi.org/10.15355/epsj.8.1.5

Dunne, J.P. and N. Tian. 2015. “Military Expenditure, Economic Growth and Heterogeneity.” Defence and Peace Economics. Vol. 26, No. 1, pp. 15–31. http://dx.doi.org/10.15355/epsj.8.1.5

Gleditsch, N.P., A. Cappelen, O. Bjerkholt, R.P. Smith, and J.P. Dunne. 1996. The Peace Dividend. Amsterdam: North Holland. http://dx.doi.org/10.1108/S0573-8555(1996)235

Perlo-Freeman, S. and E. Sköns. 2016. “Snakes and Ladders: The Development and Multiple Reconstructions of the Stockholm International Peace Research Institute’s Military Expenditure Data.” Economics of Peace and Security Journal. Vol. 11, No. 2, pp. 5–13. http://dx.doi.org/10.15355/epsj.11.2.5

Ram, R. 1995. “Defense Expenditure and Economic Growth,” pp. 251–273 in K. Hartley and T. Sandler, eds. Handbook of Defense Economics. Vol. 1 Amsterdam: Elsevier. http://dx.doi.org/10.1016/S1574-0013(05)80012-2

Smaldone, J.P. 2006 “African Military Spending: Defense versus Development?” African Security Review. Vol. 15, No. 4, pp. 18–32. http://dx.doi.org/10.1080/10246029.2006.9627618

Smith, R.P. 2000. “Defense Expenditure and Economic Growth,” pp. 15–24 in N.P. Gleditsch, G. Lindgre, N. Mouhleb, S. Smit, and I. de Soysa, eds. Making Peace Pay: A Bibliography on Disarmament and Conversion. Claremont, CA: Regina Books.

[SIPRI] Stockholm International Peace Research Institute. 2014. SIPRI Yearbook 2014: Armaments, Disarmament and International Security. Oxford, UK: Oxford University Press.

Downloads

Published

2016-10-01

How to Cite

Dunne, J. P., & Tian, N. (2016). Military expenditure and economic growth, 1960–2014. The Economics of Peace and Security Journal, 11(2). https://doi.org/10.15355/epsj.11.2.50

Issue

Section

Articles

Similar Articles

1 2 3 4 5 6 7 8 9 10 > >> 

You may also start an advanced similarity search for this article.