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Defence expenditures and external debt in Turkey

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  • Erdal Karagol

Abstract

The causal relationship between defence expenditures and external debt is investigated by applying a multivariate model. Our estimation results indicate that defence expenditures and external debt for Turkey are cointegrated. To test for Granger causality in the presence of cointegration between variables, we employ a vector error correction model. Empirical results for Turkey over the period 1955-2000 suggest a long run and short run unidirectional causality running from defence expenditures to external debt but not vice versa.

Suggested Citation

  • Erdal Karagol, 2005. "Defence expenditures and external debt in Turkey," Defence and Peace Economics, Taylor & Francis Journals, vol. 16(2), pages 117-125.
    • Handle: RePEc:taf:defpea:v:16:y:2005:i:2:p:117-125
    DOI: 10.1080/10242690500070045
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    Cited by:

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    2. Muhammad Shahbaz & Muhammad shahbaz Shabbir & Muhammad sabihuddin Butt, 2016. "Does Military Spending Explode External Debt in Pakistan?," Defence and Peace Economics, Taylor & Francis Journals, vol. 27(5), pages 718-741, September.
    3. Ullah, Assad & Zhao, Xinshun & Kamal, Muhammad Abdul & Zheng, JiaJia, 2020. "Modeling the relationship between military spending and stock market development (a) symmetrically in China: An empirical analysis via the NARDL approach," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 554(C).
    4. Adem Y. Elveren, 2012. "Military Spending and Income Inequality:Evidence on Cointegration and Causality for Turkey,1963--2007," Defence and Peace Economics, Taylor & Francis Journals, vol. 23(3), pages 289-301, April.
    5. Erdal Karagol, 2006. "The Relationship Between External Debt, Defence Expenditures And Gnp Revisited: The Case Of Turkey," Defence and Peace Economics, Taylor & Francis Journals, vol. 17(1), pages 47-57.
    6. Erdal Karagol & Aziz Turhan, 2008. "External Debt, Defence Expenditures And Political Business Cycles In Turkey," Defence and Peace Economics, Taylor & Francis Journals, vol. 19(3), pages 217-224.
    7. Paresh Kumar Narayan & Seema Narayan, 2008. "Does Military Expenditure Determine Fiji'S Exploding Debt Levels?," Defence and Peace Economics, Taylor & Francis Journals, vol. 19(1), pages 77-87.
    8. Yemane Wolde-Rufael, 2009. "The Defence Spending-External Debt Nexus In Ethiopia," Defence and Peace Economics, Taylor & Francis Journals, vol. 20(5), pages 423-436, October.
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    More about this item

    Keywords

    Debt; Defence; Turkey; Causality; JEL Codes: H63; H61; H40;
    All these keywords.

    JEL classification:

    • H63 - Public Economics - - National Budget, Deficit, and Debt - - - Debt; Debt Management; Sovereign Debt
    • H61 - Public Economics - - National Budget, Deficit, and Debt - - - Budget; Budget Systems
    • H40 - Public Economics - - Publicly Provided Goods - - - General

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