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Military Spending, Growth, Development and Conflict

Author

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  • J Paul Dunne

    (University of the West of England and University of Cape Town)

Abstract

This paper makes a contribution to the debate on the economic effects of military spending using a large cross country panel data set for 1988-2006. As well as providing a relatively up to date analysis, sub groups are created that allow the analysis to focus on groups of countries at different income levels and Sub Saharan Africa (SSA), an area which has seen a large number of damaging conflicts. Estimating the empirical growth model suggested in Dunne et al (2005) gives results that show variation across the subgroups, with the general picture of significant negative short run effect and insignificant long run effect of military burden on per capita GDP growth, not consistent across the different income groups. In addition, breaking down the SSA group into those involved in conflict and those that are not, provides some further intriguing findings that suggest the value of further work on the impact of conflict on growth.

Suggested Citation

  • J Paul Dunne, 2011. "Military Spending, Growth, Development and Conflict," Working Papers 1105, Department of Accounting, Economics and Finance, Bristol Business School, University of the West of England, Bristol.
    • Handle: RePEc:uwe:wpaper:1105
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    References listed on IDEAS

    as
    1. Jurgen Brauer, 2002. "The Arms Industry in Developing Nations: History and Post-Cold War Assessment," Palgrave Macmillan Books, in: Jurgen Brauer & J. Paul Dunne (ed.), Arming the South, chapter 5, pages 101-127, Palgrave Macmillan.
    2. Aizenman, Joshua & Glick, Reuven, 2003. "Military Expenditure, Threats, and Growth," Santa Cruz Department of Economics, Working Paper Series qt41r4105h, Department of Economics, UC Santa Cruz.
    3. Malcolm Knight & Norman Loayza & Delano Villanueva, 1996. "The Peace Dividend: Military Spending Cuts and Economic Growth," IMF Staff Papers, Palgrave Macmillan, vol. 43(1), pages 1-37, March.
    4. Biswas, Basudeb & Ram, Rati, 1986. "Military Expenditures and Economic Growth in Less Developed Countries: An Augmented Model and Further Evidence," Economic Development and Cultural Change, University of Chicago Press, vol. 34(2), pages 361-372, January.
    5. Michael Brzoska, 1983. "Research Communication: The Military Related External Debt of Third World Countries," Journal of Peace Research, Peace Research Institute Oslo, vol. 20(3), pages 271-277, September.
    6. J Paul Dunne & Fanny Coulomb, 2008. "Peace, War and International Security: Economic Theories," Working Papers 0803, Department of Accounting, Economics and Finance, Bristol Business School, University of the West of England, Bristol.
    7. Hannah Galvin, 2003. "The impact of defence spending on the economic growth of developing countries: A cross-section study," Defence and Peace Economics, Taylor & Francis Journals, vol. 14(1), pages 51-59.
    8. J Paul Dunne & Mehmet Uye, 2009. "Military Spending and Development," Working Papers 0902, Department of Accounting, Economics and Finance, Bristol Business School, University of the West of England, Bristol.
    9. Jacques Fontanel & Manas Chatterji, 2008. "War, peace and security," Post-Print hal-02388881, HAL.
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    More about this item

    Keywords

    Military expenditure; economic growth; conflict; development;
    All these keywords.

    JEL classification:

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

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