The Military Metropolis: Defense Dependence in U.S. Metropolitan Areas

Abstract

This article examines the "military metropolis," an urban community that depends highly on military expenditures in order to sustain economic vitality. We build on past theories of military Keynesianism and employ insights from urban political economy theory to examine the effects of defense contracts and defense personnel spending on five measures of labor market quality (median household income, income inequality, poverty 125 percent, unemployment, and casualization) in 276 U.S. metropolitan statistical areas in the year 2000. Whereas previous studies of military spending have focused primarily on nations and U.S. states, this study examines metropolitan areas. We test three hypotheses about how federal military outlays might influence urban economies: first, the defense-dependency hypothesis suggests that urban areas rely on defense dollars in varying degrees to sustain their economic stability and vitality. Second, the localized effects hypothesis proposes that defense personnel spending on military bases and civilian personnel will have more immediate effects on urban economies than spending on defense procurement contracts. Third, the gunbelt hypothesis predicts that military spending has affected urban economies unevenly, benefiting metropolitan areas in some regions of the country more than others. The results of this study support all three hypotheses. We offer interpretations of our results and discuss the policy implications for U.S. metropolitan areas.

Economic Impact Analysis amid Rapid Change

“…Econometric models sometimes are used for scholarly research, but the number and breadth of such studies is limited. 4 (Examples in this category include Krizan 1998; Hooker and Knetter 2001; Poppert and Herzog 2003; Andersson, Lundberg, and Sjostrom 2007; Paloyo, Vance, and Vorell 2010; Hultquist and Petras 2012; Gauchat et al 2011.) Some analyses ignore secondary economic impacts to concentrate on tallies or tabulations of direct effects, presumably with the idea that readers and users can infer their own conclusions from comparisons among regions or with other studies (Dardia et al 1996; Siehl and Knight 1996; MacKinnon 1978; Stenberg and Rowley 1993).…”