Budgetary Trade-Offs Between Defense, Education and Health Expenditures: The Case of Turkey

Abstract

The main objective of this paper is to evaluate empirically the existence of a budgetary trade-off between military, education and health expenditures in Turkey for the time period 1925-1998. Development economists, peace and defense economists and political economists have extensively investigated the existence of a trade-off between military, education and health spending since the 1970s. However, the literature review reveals that it is hard to establish a general theory of budgetary trade-off between military, education and health spending and make this applicable for all cases. This is mostly due to economic, social, political, and historical differences among the countries Moreover, it is likely that different research techniques, different time periods analyzed may produce different results. As a result of this, researchers have found a variety of outcomes regarding the trade-off between defense-education and health expenditures. This study presents a brief literature review within the framework of trade-offs between defense-education and health expenditures and also concentrates on theoretical model development. The discussion will center on developing a multi-variable single equation regression model and presenting estimable forms of equations.Turkey, Defense Expenditure, Health Expenditure, Educational Expenditure,

The Long-Run Linkages Between Education, Health and Defence Expenditures and Economic Growth: Evidence From Turkey

“…Additionally, different econometric modelling and estimation techniques used by researchers can generate different results for the same data (Deger and Smith, 1983;Ozsoy, 2002;Yildirim and Sezgin, 2002). These differences in research results led to two different strands of thought in the literature.…”

“…In the literature related to Turkey, we can see that Ozsoy (2002) found a positive relationship between education-health expenditures and per capita gross national product (GNP), and a trade-off between defence expenditures and education-health expenditures, using a simple OLS model. Using the SUR estimation method in a multi-equation framework, Yildirim and Sezgin (2002) found that there was a trade-off between defence and health expenditures, but a positive relationship between defence and education expenditures.…”

Revisiting the “Guns versus Butter” Argument in China (1950–2014): New Evidence from the Continuous Wavelet Analysis

“…The study on "guns versus butter" dates back to the pioneering work of Russett [12], which revealed that military spending is negatively correlated with the expenditures for health, education and other social welfare programs in the US, the UK, France and Canada. The negative relationship supported by the crowding-out theory has been confirmed in several studies since then [7][8][9][10][11]16]. Peroff [16] and Peroff and Podolak-Warren [11] found the existence of crowding-out effect in the US.…”

“…Dabelko and McCormick [8], Deger [9] and Apostolakis [7] added to this view by providing the evidence in 77 countries, 50 less developed countries and 19 Latin American countries, respectively. There was also shown to be a crowding-out effect between defense and social welfare expenditures in Turkey [10]. In contrast, some studies suggested that the increase in defense expenditure could promote social welfare supported by the Keynesian theory [3,4,6,17,18].…”

“…On the one hand, from the Keynesian point of view, the expansion of defense expenditure can increase the aggregate demand, and accordingly stimulate the social welfare spending [3][4][5][6]. On the other hand, due to government budget constraints, the existence of the crowding-out effect suggests the expansion of defense expenditure can be at the expense of non-defense spending, such as education, health, culture and technology [6][7][8][9][10][11][12]. However, several studies contended that an increase in defense spending does not necessarily have any effect on social welfare spending [13][14][15].…”