IDEAS home Printed from https://ideas.repec.org/a/epc/journl/v11y2016i2p50-56.html
   My bibliography  Save this article

Military expenditure and economic growth, 1960–2014

Author

Listed:
  • J. Paul Dunne

    (School of Economics and the Southern Africa Labour and Development Research Unit, University of Cape Town, South Africa)

  • Nan Tian

    (Southern Africa Labour and Development Research Unit, University of Cape Town, South Africa)

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.

Suggested Citation

  • J. Paul Dunne & Nan Tian, 2016. "Military expenditure and economic growth, 1960–2014," Economics of Peace and Security Journal, EPS Publishing, vol. 11(2), pages 50-56, October.
    • Handle: RePEc:epc:journl:v:11:y:2016:i:2:p:50-56
    as

    Download full text from publisher

    File URL: http://www.epsjournal.org.uk/index.php/EPSJ/article/view/257
    Download Restriction: Open access 24 months after original publication.
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. W. Robert J. Alexander, 2013. "Military Spending And Economic Growth In South Asia: Comment And Reconsideration," Defence and Peace Economics, Taylor & Francis Journals, vol. 24(2), pages 173-178, April.
    2. Ram, Rati, 1995. "Defense expenditure and economic growth," Handbook of Defense Economics, in: Keith Hartley & Todd Sandler (ed.), Handbook of Defense Economics, edition 1, volume 1, chapter 10, pages 251-274, Elsevier.
    3. Sandler,Todd & Hartley,Keith, 1995. "The Economics of Defense," Cambridge Books, Cambridge University Press, number 9780521447287, January.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Saba Charles Shaaba, 2022. "Defence Spending and Economic Growth in South Africa: Evidence from Cointegration and Co-Feature Analysis," Peace Economics, Peace Science, and Public Policy, De Gruyter, vol. 28(1), pages 51-100, February.
    2. Ortiz, Cristian & Alvarado, Rafael & Salinas, Aldo, 2019. "The effect of military spending on output: New evidence at the global and country group levels using panel data cointegration techniques," Economic Analysis and Policy, Elsevier, vol. 62(C), pages 402-414.
    3. Florin ŞUHAN, 2019. "Study On Defense Expenditure And Its Financing," EURINT, Centre for European Studies, Alexandru Ioan Cuza University, vol. 6, pages 256-268.
    4. J. Paul Dunne, 2017. "War, peace, and development," Economics of Peace and Security Journal, EPS Publishing, vol. 12(2), pages 21-31, October.
    5. J. Paul Dunne & Nan Tian, 2019. "Military Expenditures and Economic Growth," School of Economics Macroeconomic Discussion Paper Series 2019-05, School of Economics, University of Cape Town.
    6. Christos Kollias & Suzanna Maria Paleologou & Panayiotis Tzeremes & Nickolaos Tzeremes, 2018. "The demand for military spending in Latin American countries," Latin American Economic Review, Springer;Centro de Investigaciòn y Docencia Económica (CIDE), vol. 27(1), pages 1-17, December.
    7. Brauer Jurgen, 2017. "‘Of the Expence of Defence’: What Has Changed Since Adam Smith?," Peace Economics, Peace Science, and Public Policy, De Gruyter, vol. 23(2), pages 1-14, April.
    8. Giorgio d’Agostino & J. Paul Dunne & Luca Pieroni, 2017. "Does Military Spending Matter for Long-run Growth?," Defence and Peace Economics, Taylor & Francis Journals, vol. 28(4), pages 429-436, July.
    9. J. Paul Dunne & Ron P. Smith, 2020. "Military Expenditure, Investment and Growth," Defence and Peace Economics, Taylor & Francis Journals, vol. 31(6), pages 601-614, August.
    10. Andrew Phiri, 2019. "Does Military Spending Nonlinearly Affect Economic Growth in South Africa?," Defence and Peace Economics, Taylor & Francis Journals, vol. 30(4), pages 474-487, June.
    11. Kyriakos Emmanouilidis & Christos Karpetis, 2022. "Cross–Country Dependence, Heterogeneity and the Growth Effects of Military Spending," Defence and Peace Economics, Taylor & Francis Journals, vol. 33(7), pages 842-856, October.
    12. Charles Shaaba Saba & Nicholas Ngepah, 2019. "A cross-regional analysis of military expenditure, state fragility and economic growth in Africa," Quality & Quantity: International Journal of Methodology, Springer, vol. 53(6), pages 2885-2915, November.
    13. Charles Shaaba Saba & Nicholas Ngepah, 2022. "Nexus between defence spending, economic growth and development: evidence from a disaggregated panel data analysis," Economic Change and Restructuring, Springer, vol. 55(1), pages 109-151, February.
    14. Charles Shaaba Saba & Nicholas Ngepah, 2019. "Military expenditure and economic growth: evidence from a heterogeneous panel of African countries," Economic Research-Ekonomska Istraživanja, Taylor & Francis Journals, vol. 32(1), pages 3586-3606, January.
    15. Kyriakos Emmanouilidis & Christos Karpetis, 2020. "The Defense–Growth Nexus: A Review of Time Series Methods and Empirical Results," Defence and Peace Economics, Taylor & Francis Journals, vol. 31(1), pages 86-104, January.
    16. Charles Shaaba Saba & Nicholas Ngepah, 2022. "Nexus between telecommunication infrastructures, defence and economic growth: a global evidence," Netnomics, Springer, vol. 22(2), pages 139-177, October.
    17. Christos Kollias & Panayiotis Tzeremes, 2022. "Militarization, investment, and economic growth 1995–2019," Economics of Peace and Security Journal, EPS Publishing, vol. 17(1), pages 17-29, April.
    18. Shakoor Ahmed & Khorshed Alam & Afzalur Rashid & Jeff Gow, 2020. "Militarisation, Energy Consumption, CO2 Emissions and Economic Growth in Myanmar," Defence and Peace Economics, Taylor & Francis Journals, vol. 31(6), pages 615-641, August.
    19. Christos Kollias & Suzanna-Maria Paleologou, 2019. "Military spending, economic growth and investment: a disaggregated analysis by income group," Empirical Economics, Springer, vol. 56(3), pages 935-958, March.
    20. Christos Kollias & Suzanna-Maria Paleologou & Panayiotis Tzeremes & Nickolaos Tzeremes, 2017. "Defence expenditure and economic growth in Latin American countries: evidence from linear and nonlinear causality tests," Latin American Economic Review, Springer;Centro de Investigaciòn y Docencia Económica (CIDE), vol. 26(1), pages 1-25, December.
    21. Jang C. Jin & Go En Chang, 2022. "Military technology and the North Korean economy: evidence from time‐series data," Asian-Pacific Economic Literature, The Crawford School, The Australian National University, vol. 36(2), pages 106-117, November.
    22. Jordan Becker & J Paul Dunne, 2023. "Military Spending Composition and Economic Growth," Defence and Peace Economics, Taylor & Francis Journals, vol. 34(3), pages 259-271, April.
    23. Dada James Temitope & Awoleye Emmanuel Olayemi & Arnaut Marina & Al-Faryan Mamdouh Abdulaziz Saleh, 2023. "Revisiting the Military Expenditure-Growth Nexus: Does Institutional Quality Moderate the Effect?," Peace Economics, Peace Science, and Public Policy, De Gruyter, vol. 29(1), pages 19-42, February.
    24. Kollias Christos & Paleologou Suzanna-Maria & Tzeremes Panayiotis, 2020. "Defence Spending and Unemployment in the USA: Disaggregated Analysis by Gender and Age Groups," Peace Economics, Peace Science, and Public Policy, De Gruyter, vol. 26(2), pages 1-13, May.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Chang, Hsin-Chen & Huang, Bwo-Nung & Yang, Chin Wei, 2011. "Military expenditure and economic growth across different groups: A dynamic panel Granger-causality approach," Economic Modelling, Elsevier, vol. 28(6), pages 2416-2423.
    2. Julien Malizard, 2014. "Dépenses militaires et croissance économique dans un contexte non linéaire. Le cas français," Revue économique, Presses de Sciences-Po, vol. 65(3), pages 601-618.
    3. Linda Andersson & Johan Lundberg & Magnus Sjostrom, 2007. "Regional Effects Of Military Base Closures: The Case Of Sweden," Defence and Peace Economics, Taylor & Francis Journals, vol. 18(1), pages 87-97.
    4. Pavel Yakovlev, 2007. "Arms Trade, Military Spending, And Economic Growth," Defence and Peace Economics, Taylor & Francis Journals, vol. 18(4), pages 317-338.
    5. Stergios Skaperdas, 2011. "The costs of organized violence: a review of the evidence," Economics of Governance, Springer, vol. 12(1), pages 1-23, March.
    6. Julien Malizard, 2013. "Opportunity Cost Of Defense: An Evaluation In The Case Of France," Defence and Peace Economics, Taylor & Francis Journals, vol. 24(3), pages 247-259, June.
    7. Alptekin, Aynur & Levine, Paul, 2012. "Military expenditure and economic growth: A meta-analysis," European Journal of Political Economy, Elsevier, vol. 28(4), pages 636-650.
    8. Giorgio d’Agostino & John Paul Dunne & Luca Pieroni, 2019. "Military Expenditure, Endogeneity and Economic Growth," Defence and Peace Economics, Taylor & Francis Journals, vol. 30(5), pages 509-524, July.
    9. Reitschuler, Gerhard & Loening, Josef L., 2005. "Modeling the Defense-Growth Nexus in Guatemala," World Development, Elsevier, vol. 33(3), pages 513-526, March.
    10. Jurgen Brauer, 2002. "Survey and Review of the Defense Economics Literature on Greece and Turkey: What Have We Learned?," Defence and Peace Economics, Taylor & Francis Journals, vol. 13(2), pages 85-107.
    11. 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.
    12. Joshua Aizenman & Reuven Glick, 2006. "Military expenditure, threats, and growth," The Journal of International Trade & Economic Development, Taylor & Francis Journals, vol. 15(2), pages 129-155.
    13. Wijeweera Albert & Webb Matthew J., 2010. "A Peace Dividend for Sri Lanka: The Case for a Return to Prosperity Following the End of Hostilities," Global Economy Journal, De Gruyter, vol. 10(2), pages 1-11, May.
    14. Mohaned Al-Hamdi & Mohammad Alawin, 2017. "The Relationship Between Military Expenditure and Economic Growth in Some Middle Eastern Countries: What Is the Story?," Asian Social Science, Canadian Center of Science and Education, vol. 13(1), pages 1-45, January.
    15. Jean-Yves Caro, 1998. "Croissance et dépenses de défense dans les pays de l'Asean," Revue Économique, Programme National Persée, vol. 49(1), pages 139-149.
    16. Tiwari, Aviral & Shahbaz, Muhammad, 2011. "Does Defence Spending Stimulate Economic Growth in India?," MPRA Paper 30880, University Library of Munich, Germany, revised 18 Apr 2011.
    17. Tilman Bruck, 2005. "An Economic Analysis Of Security Policies," Defence and Peace Economics, Taylor & Francis Journals, vol. 16(5), pages 375-389.
    18. Katarina Keller & Panu Poutvaara & Andreas Wagener, 2009. "Military Draft And Economic Growth In Oecd Countries," Defence and Peace Economics, Taylor & Francis Journals, vol. 20(5), pages 373-393, October.
    19. Giorgio d’Agostino & J. Paul Dunne & Luca Pieroni, 2017. "Does Military Spending Matter for Long-run Growth?," Defence and Peace Economics, Taylor & Francis Journals, vol. 28(4), pages 429-436, July.
    20. Kimbambu Tsasa Vangu, Jean - Paul, 2012. "Analyse de la Relation Guerres Civiles et Croissance Économique [Civil Wars and Economic Growth in DRC]," MPRA Paper 42424, University Library of Munich, Germany, revised 05 Feb 2012.

    More about this item

    Keywords

    Military expenditure; economic growth; data;
    All these keywords.

    JEL classification:

    • H56 - Public Economics - - National Government Expenditures and Related Policies - - - National Security and War
    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:epc:journl:v:11:y:2016:i:2:p:50-56. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Michael Brown, Managing Editor, EPSJ (email available below). General contact details of provider: https://edirc.repec.org/data/ecaarea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.