<abstract xmlns="http://www.w3.org/1999/xhtml">

<p>This study examines the complexities involved in calculating the impact of military spending on economic growth, as well as the reasons for the lack of consensus in the academic literature. It explores econometric approaches for panels and provides a brief overview of economic theory, highlighting the difficult identification challenges involved in identifying the connection between military expenditures and output. Using the enlarged SIPRI military spending data, a relatively large and balanced panel of nations for the period 1960-2014 is constructed. Rather than focusing on the direct relationship between military spending and economic growth, this paper emphasizes the investment channel. It presents estimates of various models analyzing the interaction between the three variables and concludes that the data do not indicate strong relationships between military expenditure and investment or growth. Given the identified theoretical and economic issues, this is not unexpected.</p>
</abstract>

This study examines the complexities involved in calculating the impact of military spending on economic growth, as well as the reasons for the lack of consensus in the academic literature. It explores econometric approaches for panels and provides a brief overview of economic theory, highlighting the difficult identification challenges involved in identifying the connection between military expenditures and output. Using the enlarged SIPRI military spending data, a relatively large and balanced panel of nations for the period 1960-2014 is constructed. Rather than focusing on the direct relationship between military spending and economic growth, this paper emphasizes the investment channel. It presents estimates of various models analyzing the interaction between the three variables and concludes that the data do not indicate strong relationships between military expenditure and investment or growth. Given the identified theoretical and economic issues, this is not unexpected.

Does Military Spending Spur Economic Growth? An Empirical Approach

Proceedings of the International Conference on Business Excellence

This work is licensed under the Creative Commons Attribution 4.0 International License.

{"article-title":"Does Military Spending Spur Economic Growth? An Empirical Approach"}

This study examines the complexities involved in calculating the impact of military spending on economic growth, as well as the reasons for the lack of...

Does Military Spending Spur Economic Growth? An Empirical Approach

Published Online: Jul 14, 2023

Page range: 178 - 187

DOI: https://doi.org/10.2478/picbe-2023-0020

Keywords
military spending, economic growth, investment

© 2023 Alexandra-Carmen Bran, published by Sciendo

This work is licensed under the Creative Commons Attribution 4.0 International License.

Does Military Spending Spur Economic Growth? An Empirical Approach

Published Online: Jul 14, 2023

Page range: 178 - 187

DOI: https://doi.org/10.2478/picbe-2023-0020

Keywordsmilitary spending, economic growth, investment

© 2023 Alexandra-Carmen Bran, published by Sciendo

This work is licensed under the Creative Commons Attribution 4.0 International License.

Keywords
military spending, economic growth, investment