Domestic political and external security determinants of the demand for greek military expenditure

Abstract

By European Union and NATO standards, Greece consistently allocates substantial human and material resources to defence. The Greek defence burden (i.e. military expenditure as a share of GDP) has invariably been appreciably higher than the EU and NATO averages. The paper applies an autoregressive distributed lag model (ARDL) to present cointegrated estimates of the demand function for Greek military expenditure, in which domestic political factors and external security determinants are incorporated. Our empirical findings suggest that Greek defence spending over the period 1960-1998 has been influenced by both external security concerns, namely Turkey, as well as changes in the domestic political scene.Greece, Turkey, Demand For Military Expenditure, Political Determinants, External Security, Cointegration, Autoregressive Distributed Lag Model,

Financial Versus Human Resources in the Greek–turkish Arms Race 10 Years On: A Forecasting Investigation Using Artificial Neural Networks

“…Efforts to the direction of incorporating the influence of political and external security determinants 1 on the Greek demand for defence spending are made by Kollias and Paleologou (2003), which, however, has no choice but to adhere to the traditional solution provided by an extensive use of dummy variables while the use of dummy variables to improve the performance of Richardson -type models has been also tried by Dunne et al (2005), encountering, however, a certain number of specification problems. Finally, Sahin and Ozsoy (2008) have chosen to employ a Markov switching approach in an effort to provide an empirical evaluation of the defence expenditure of Greece and Turkey.…”

Residential Characteristics of Armed-Forces Personnel and the Urban Economy: Evidence from a Medium Sized City in Greece

“…Due to serious external security concerns, Greece allocates substantial human and material resources to defence (Kollias 1995, Kollias andPaleologou 2003). Both in terms of the defence burden (military spending as a share of GDP) as well as in terms of human capital committed to defence, Greece invariably surpasses the corresponding NATO averages (see Table 1).…”

The Demand for Military Spending in Egypt

“…This implicitly suggests that developing case study analysis is particularly important. In a case study of Greece, Kollias and Paleologou (2003) follow the usual modelling path, but put particular emphasis on incorporating variables that reflect the domestic political changes.…”

“…This suggests that more work needs to be done to find suitable measures of security perceptions and that this will need to move beyond the Polity 2 variables which failed to achieve significance. One possible route is to follow Kollias and Paleologou (2003) in introducing domestic political and electoral variables.…”