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Defence Spending And The Macroeconomy: The Case Of Turkey

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  • Onur Ozsoy

Abstract

This study uses a six-variable vector autoregressive (VAR) model and analyses the relationship between defence spending as a percentage of GNP, government budget as a percentage of GNP, total deficit as a percentage of GNP, the GNP growth rates, inflation rates, and government budget deficit as a percentage of GNP for the case of Turkey from 1933 to 2004. The impulse response functions (IRFs) are also derived and Granger causalities among the variables estimated. The results support the short-run causality between defence spending and economic growth.

Suggested Citation

  • Onur Ozsoy, 2008. "Defence Spending And The Macroeconomy: The Case Of Turkey," Defence and Peace Economics, Taylor & Francis Journals, vol. 19(3), pages 195-208.
    • Handle: RePEc:taf:defpea:v:19:y:2008:i:3:p:195-208
    DOI: 10.1080/10242690801972139
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    References listed on IDEAS

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    1. Davidson, Russell & MacKinnon, James G., 1993. "Estimation and Inference in Econometrics," OUP Catalogue, Oxford University Press, number 9780195060119.
    2. Engle, Robert F., 1984. "Wald, likelihood ratio, and Lagrange multiplier tests in econometrics," Handbook of Econometrics, in: Z. Griliches† & M. D. Intriligator (ed.), Handbook of Econometrics, edition 1, volume 2, chapter 13, pages 775-826, Elsevier.
    3. David H. Romer, 2000. "Keynesian Macroeconomics without the LM Curve," Journal of Economic Perspectives, American Economic Association, vol. 14(2), pages 149-169, Spring.
    4. John B. Taylor, 2000. "Teaching Modern Macroeconomics at the Principles Level," American Economic Review, American Economic Association, vol. 90(2), pages 90-94, May.
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    Cited by:

    1. Muhammad, Shahbaz & Reza, Sherafatian-Jahromi & Muhammad, Nasir Malik, 2012. "Linkages between Defence Spending and Income Inequality in Iran," MPRA Paper 41983, University Library of Munich, Germany, revised 14 Oct 2012.

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