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Dépenses militaires, croissance et bien être : une simulation de l’impact macroéconomique de la R&D défense

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  • Thierry Laurent

Abstract

This paper aims at providing a simple economic framework to address a somewhat neglected question of economic policy, namely the optimal share of investments in military R&D in total public spending. In order to capture the long-run impact of tax-financed military R&D on the growth rate, we develop an endogenous growth model in the spirit of Barro [1990]. The model focuses on the optimal sharing of public resources between consumption, civil investment, military R&D and other military expenditures. Taking into account two types of R&D ? tax-financed military R&D vs private (non-military) R&D ? allows us to analyze how the government manages the optimal allocation of tax resources between public funding of military R&D on the one side, and the provision of subsidies to private R&D on the other side. The results emphasize the key role played by military R&D in enhancing economic growth and welfare in the long run.

Suggested Citation

  • Thierry Laurent, 2012. "Dépenses militaires, croissance et bien être : une simulation de l’impact macroéconomique de la R&D défense," Revue d'économie politique, Dalloz, vol. 122(6), pages 971-1009.
    • Handle: RePEc:cai:repdal:redp_226_0971
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    References listed on IDEAS

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    1. Angus C. Chu & Ching-Chong Lai, 2012. "On the Growth and Welfare Effects of Defense R&D," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 14(3), pages 473-492, June.
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    3. J. Paul Dunne & Ron Smith & Dirk Willenbockel, 2005. "Models Of Military Expenditure And Growth: A Critical Review," Defence and Peace Economics, Taylor & Francis Journals, vol. 16(6), pages 449-461.
    4. van der Ploeg, F & de Zeeuw, A J, 1990. "Perfect Equilibrium in a Model of Competitive Arms Accumulation," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 31(1), pages 131-146, February.
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