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A Causality Analysis Of The Military Spending And Economic Growth: The Colombian Case Of 1960-2016

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  • John Michael, Riveros Gavilanes

Abstract

This paper establish an approximation to the existing causality relation between the military expenditure and economic growth for Colombia in the period of 1960 to 2017. The methodology uses the approach of the VEC models to estimate the long-run and short-run causality between the variables and its relative impact. The results indicate causality in Granger terms only from the military expenditure to the GDP and the existence of co-integration among them. In the short-run, the impact of this variable is positive to the GDP while in the long-run the military expenditure effect negatively the growth.

Suggested Citation

  • John Michael, Riveros Gavilanes, 2019. "A Causality Analysis Of The Military Spending And Economic Growth: The Colombian Case Of 1960-2016," MPRA Paper 103255, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:103255
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    References listed on IDEAS

    as
    1. Venus Khim-Sen Liew, 2004. "Which Lag Length Selection Criteria Should We Employ?," Economics Bulletin, AccessEcon, vol. 3(33), pages 1-9.
    2. Abu-Bader, Suleiman & Abu-Qarn, Aamer S., 2003. "Government expenditures, military spending and economic growth: causality evidence from Egypt, Israel, and Syria," Journal of Policy Modeling, Elsevier, vol. 25(6-7), pages 567-583, September.
    3. Manfred Grautoff & Fernando Chavarro Miranda, 2009. "Análisis del gasto militar desde la perspectiva de la economía de la defensa: El caso colombiano 1950-2006," Revista Ecos de Economía, Universidad EAFIT, April.
    4. repec:bgu:wpaper:163 is not listed on IDEAS
    5. Johansen, Soren, 1991. "Estimation and Hypothesis Testing of Cointegration Vectors in Gaussian Vector Autoregressive Models," Econometrica, Econometric Society, vol. 59(6), pages 1551-1580, November.
    6. Muhammad Ajmair & Khadim Hussain & Faisal Azeem Abbassi & Misbah Gohar, 2018. "The Impact of Military Expenditures on Economic Growth of Pakistan," Applied Economics and Finance, Redfame publishing, vol. 5(2), pages 41-48, March.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Economic growth; Military expenditure; Granger causality; Co-integration;
    All these keywords.

    JEL classification:

    • H40 - Public Economics - - Publicly Provided Goods - - - General
    • H56 - Public Economics - - National Government Expenditures and Related Policies - - - National Security and War
    • H83 - Public Economics - - Miscellaneous Issues - - - Public Administration
    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General

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