An Analysis of Defence Expenditure and Economic Growth in South Africa

Mosikari, Teboho Jeremiah; Matlwa, Keabetswe

doi:10.5901/mjss.2014.v5n20p2769

Cited by 8 publications

(9 citation statements)

References 16 publications

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“…This research has been guided by the estimation of defense spendingeconomic growth nexus in the European Union countries. The authors have referred to Keynesian macroeconomic approach as well as Wagnerian theory (Bataineh 2012) and Granger causality testing, which is prevailing method in recent similar research (Hirnissa & Baharom, 2009;Pradhan, 2010;Feridun et al, 2011;Dimitraki & Ali, 2013;Shahbaz et al, 2013;Khalid & Mustapha, 2014;Duella, 2014;Mosikari & Matiwa, 2014;Dunne & Tian, 2015;Topcu & Aras, 2015). The ratios of defense expenditure as a percentage of GDP and GDP per capita are used.…”

Section: Methodsmentioning

confidence: 99%

“…Granger test has assessed the running causality and the direction of relationship between defense spending and economic growth. Granger causality test requires estimating the following two regression equations (Shahbaz et al, 2013;Farzanegan, 2014;Mosikari & Matiwa, 2014;Dudzeviciute & Tamosiuniene, 2014):…”

Section: Methodsmentioning

confidence: 99%

“…The examination of defense spendingeconomic growth nexus was conducted by Mosikari and Matiwa (2014) in South Africa in a period of 1988-2012. The causal analysis revealed that military expenditure was Granger cause of economic growth at 5 percent of significance level.…”

Section: Overview Of Recent Researchmentioning

confidence: 99%

“…The review of the recent research (Alptekin, Levine, 2012;Anwar et al, 2012;Tiwari, Shahbaz, 2013;Khalid, Mustapha, 2014;Duella, 2014;Ave et al, 2014;Mosikari, Matiwa, 2014;Malizard, 2014) has revealed inconclusive results. It may be noticed that in academic context defense spendingeconomic growth nexus has been analyzed from different theoretical aspects.…”

Section: Introductionmentioning

confidence: 99%

See 3 more Smart Citations

Tendencies and Relations of Defense Spending and Economic Growth in the EU Countries

Dudzevičiūtė¹,

Peleckis²,

Peleckienė³

2016

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European countries are surrounded by growing conflicts and security threats. For every country it is necessary to ensure internal and external security. Defense should be seen as preventative spending as well as like an insurance policy. In terms of that, many policy makers have to decide how much money should be spent on defense. This paper investigates the tendencies and relationships of defense spending and economic growth in the European Union (EU) countries taking into consideration the level of countries' economic development over the period of 2004-2013. The authors have done this by considering a number of descriptive statistical indicators and applying Granger testing. Based on the real gross domestic product (GDP) per capita, the European Union countries have been classified into five categories. The association between defense spending and economic growth has been estimated. On the basis of causality testing, the prevailing causality direction is from defense spending to economic growth in the group of countries of a very high level of economic development. However, in the group of countries of lower or mid-level of economic development the causality runs from economic growth to defense spending. For the remaining group of countries, no causal relationship has been detected between these two variables. The paper is concerned with defense spending and economic growth only. The authors have not considered all the other factors. That is the major limitation of this paper. Despite of this, the research highlights the key trends and relationships, which should be of particular interest to policy makers. However, every country is unique, and the economic growth or decline do not imply spontaneous change in defense expenditure. Prospective threats may be the most important factor for the expansion of defense spending.

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Section: Methodsmentioning

confidence: 99%

Section: Methodsmentioning

confidence: 99%

Section: Overview Of Recent Researchmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

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Tendencies and Relations of Defense Spending and Economic Growth in the EU Countries

Dudzevičiūtė¹,

Peleckis²,

Peleckienė³

2016

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“…Several studies have investigated the impact of SA’s defence spending on economic growth, with mixed conclusions about the effects of defence spending on economic growth and the causal direction of the two variables ( inter alia : Birdi and Dunne 2002 ; Mosikari and Matlwa 2014 ; Aye et al 2014 ; Phiri 2019 ; Saba 2021 ). Furthermore, the environmental consequences of defence spending in SA have not been studied.…”

Section: Introductionmentioning

confidence: 99%

CO2 emissions-energy consumption-militarisation-growth nexus in South Africa: evidence from novel dynamic ARDL simulations

Saba

2022

Environ Sci Pollut Res

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This study draws ardent attention to the Sustainable Development Goal 13 (climate change mitigation) of the United Nations by investigating the CO 2 emissions-energy consumption-militarisation-economic growth nexus for South Africa (SA) from 1960 to 2019. The researcher applied frequency domain causality and the novel dynamic autoregressive distributed lag (ARDL) simulation approaches to achieve the research objective. The main findings reflected that (i) there is a long-run equilibrium relationship between the variables; (ii) there is no causality between militarisation and energy consumption; (iii) unidirectional causality runs from militarisation to economic growth; (iv) there is no causality between militarisation and CO 2 emissions; and (v) unidirectional causality runs from energy consumption to economic growth. The dynamic ARDL simulations’ main results suggest that (i) in the short-run, a positive and insignificant relationship exist between militarisation and CO 2 emissions. Conversely, a negative and significant relationship was recorded in the long-run. Thus, the treadmill theory of destruction is not valid for SA. (ii) In the short-run, economic growth has a positive and significant impact on CO 2 emissions, while in the long-run, economic growth has a negative and significant impact on CO 2 emissions. This implies the environmental Kuznets curve (EKC) hypothesis holds for SA. Overall, this research suggests a synergy between defence, energy, growth, and environmental policies in the short- and long-run to promote and maintain environmental quality in SA.

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The Asymmetric Relationship Between Military Expenditure, Economic Growth and Industrial Productivity: An Empirical Analysis of India, China and Pakistan Via the NARDL Approach

Syed

2021

Finanz. polit. econ

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This research work aims to verify how military expenditure promotes economic growth and industrial productivity, as suggested by the Military Keynesianism postulate. The NARDL method is employed to achieve the above objective on the panel data of India, China, and Pakistan, covering the period between 1990 and 2018. The study finds that the positive and negative impact of military expenditure has a significant positive and negative effect on economic growth in the long run for China and India; however, in the short-run, only positive impact favors economic growth. Thus, there is a symmetric effect in the short-run and an asymmetric impact in the long-run. This asymmetric result supports the work of Military Keynesianism, helping policymakers in devising appropriate macro-economic policies.

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An Analysis of Defence Expenditure and Economic Growth in South Africa

Abstract: Abstract

Cited by 8 publications

References 16 publications

Tendencies and Relations of Defense Spending and Economic Growth in the EU Countries

Tendencies and Relations of Defense Spending and Economic Growth in the EU Countries

CO2 emissions-energy consumption-militarisation-growth nexus in South Africa: evidence from novel dynamic ARDL simulations

The Asymmetric Relationship Between Military Expenditure, Economic Growth and Industrial Productivity: An Empirical Analysis of India, China and Pakistan Via the NARDL Approach

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