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Side Effects of War on the US Economy

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  • Farhidi, Faraz

Abstract

Having studied the ancient empires, achieving political and economic powers, have been hovered one of the most critical issues all the time for the nations. The strategies to secure those might be different, but the intension still stays the same: controlling the labor and capital markets. Reviewing the historical colonization, one would recognize that there is a significant correlation between the political power and economic power within the countries. Among all the explanations on the approaches to attain these ambitions, using conquest other nations to gain resources and new territory and labor force seems to be one the unfortunate motives in this discussion. In the current study, having analyzed the macro data, I claim the feasibility of a positive causal relationship between having wars abroad and government expenditure in the long run within the studied period in the United States. While in the investigated duration, war seems to have a positive effect on the personal consumptions and the negative one on the export of goods and services, as well as private investments in the short run, as a consequence.

Suggested Citation

  • Farhidi, Faraz, 2015. "Side Effects of War on the US Economy," MPRA Paper 68476, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:68476
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    References listed on IDEAS

    as
    1. Krosnick, Jon A. & Brannon, Laura A., 1993. "The Impact of the Gulf War on the Ingredients of Presidential Evaluations: Multidimensional Effects of Political Involvement," American Political Science Review, Cambridge University Press, vol. 87(4), pages 963-975, December.
    2. Collier, Paul & Hoeffler, Anke, 1998. "On Economic Causes of Civil War," Oxford Economic Papers, Oxford University Press, vol. 50(4), pages 563-573, October.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    US Economy; War; Causal relation; Macro elements;
    All these keywords.

    JEL classification:

    • C20 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - General
    • E20 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - General (includes Measurement and Data)
    • H56 - Public Economics - - National Government Expenditures and Related Policies - - - National Security and War
    • N42 - Economic History - - Government, War, Law, International Relations, and Regulation - - - U.S.; Canada: 1913-
    • O41 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - One, Two, and Multisector Growth Models

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