A non‐linear defence‐growth nexus? evidence from the US economy

Cuaresma, Jesús Crespo; Reitschuler, Gerhard

doi:10.1080/1024269042000164504

Cited by 80 publications

(29 citation statements)

References 27 publications

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“…The seminal work of Benoit (1973Benoit ( , 1978 has spurred an increasing attention on the economic impact of defence spending with the relevant literature steadily expanding ever since (inter alia : Chowdhury, 1991;Dakurah et al, 2001;Sezgin, 2001;Atesoglu, 2002;Dunne et al, 2002;Abu-Bader and Abu-Qarm, 2003;Cuaresma and Reitschuler, 2004;Halicioglu, 2004;Bas, 2005;Yildirim et al, 2005;Kollias et al, 2007;Lee and Chen, 2007;Özsoy, 2008;Wijeweera and Webb, 2009). Broadly speaking, the findings are mixed and inconclusive with results depending on the country or sample of countries, the time period or the methodology used (for a survey of the findings and the issues see Dunne et al, 2005).…”

Section: Introductionmentioning

confidence: 92%

Does Defence Spending Impede Economic Growth? Cointegration and Causality Analysis for Pakistan

Shahbaz

Afza

Shabbir

2013

Defence and Peace Economics

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This study revisits the relationship between defence spending and economic growth via a Keynesian model in Pakistan using the autoregressive distributive lag bounds testing approach to cointegration. Empirical evidence suggests a stable cointegration relationship between defence spending and economic growth. An increase in defence spending reduces the pace of economic growth confirming the validity of Keynesian hypothesis in this case. Current economic growth is positively linked with economic growth of previous periods while a rise in nonmilitary expenditures boosts economic growth. Interest rate is inversely associated with economic growth. Finally, unidirectional causality running from military spending to economic growth is found.

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Section: Introductionmentioning

confidence: 92%

Does Defence Spending Impede Economic Growth? Cointegration and Causality Analysis for Pakistan

Shahbaz

Afza

Shabbir

2013

Defence and Peace Economics

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“…For example, one study estimates threshold regressions and shows a level-dependent effect of military expenditure on growth, namely, positive effects for low levels of military expenditure but negative ones for high levels. 21 But another study finds clear negative effects at both high and low levels of military expenditure. 22 A further concern of researchers was to allow for the opportunity cost of military expenditure, the trade-off between this and other forms of state expenditure.…”

Section: The Economics Of Peace and Security Journal Issn 1749-852xmentioning

confidence: 99%

Military expenditure and economic growth: A survey

Dunne¹,

Tian²

2013

EPSJ

106

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U ntil recently, a long-standing, impressively large, and growing literature appeared to have failed to result in a scholarly consensus on the effects of military expenditure on economic growth. But the availability of 20 more years of data since the end of the cold war has helped researchers to make progress in identifying any relation of military expenditure with economic factors. The literature is complex and difficult to summarize, with studies differing in their theoretical approach, in the empirical methods used, in the coverage of countries and time periods employed, and in their quality and statistical significance. This article extends and updates an earlier survey by Dunne and Uye, 1 now covering almost 170 studies. It finds that more recent studies provide increasingly stronger evidence of a negative effect of military expenditure on growth. The following sections discuss the general nexus between military expenditure and economic growth, reviews general theoretical issues and the empirical literature, and evaluates the effect of adding the more recent studies to the older ones. The final section presents some conclusions.

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“…Therefore, if C M and δ are positive, the effect of milexp on growth is expected to be positive. This model has been used by many; Alexander (1990), Atesoglu and Mueller (1990), Huang and Mintz (1991), (Ward and Davis, 1992), Cuaresma and Reitschuler (2004), among others. However suggest that there are important shortcoming of the model in terms of the interpretation of results as well as econometric techniques.…”

Section: The Three Approachesmentioning

confidence: 99%

Military expenditure and economic growth: A meta-analysis

Alptekin

Levine

2012

European Journal of Political Economy

207

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Meta analysis is conducted to review 32 empirical studies with 169 estimates to find the combined overall effect of military expenditure on economic growth. Using a meta fixed and random effects and regression analysis, our results show that there exists a "genuine" net effect of military expenditure on economic growth. The net combined effect is positive, and the magnitude is very small. The main sources of study-to-study variation in the findings of military expenditure and economic growth literature are attributable to the sample, time periods, and functional forms.JEL Classification: C42, H5, O11, 041, 047

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A non‐linear defence‐growth nexus? evidence from the US economy

Cited by 80 publications

References 27 publications

Does Defence Spending Impede Economic Growth? Cointegration and Causality Analysis for Pakistan

Does Defence Spending Impede Economic Growth? Cointegration and Causality Analysis for Pakistan

Military expenditure and economic growth: A survey

Military expenditure and economic growth: A meta-analysis

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