Panel Causality Analysis Between Defence Expenditure and Economic Growth in Developed Countries

Yilgör, Metehan; Karagöl, Erdal Tanas; Saygili, Çiğdem Ateş

doi:10.1080/10242694.2012.724879

Cited by 47 publications

(8 citation statements)

References 14 publications

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“…The authors have found that defence expenditure is a factor in economic growth. Finally, the research has concluded that defence expenditure in economically developed countries positively contributes to their economic development [12]. Huang et al (2014) also agree that increasing the share of defence expenditure is favourable for economically strong countries [14].…”

Section: Literature Reviewmentioning

confidence: 98%

“…There has been controversy in the scientific literature over whether defence spending has a positive, negative or no relation impact on economic growth [12]. In examining the relationship between defence and economic growth, it is possible to distinguish 4 types of links as follows: 1) a link showing impact of defence spending on economic development, 2) a link demonstrating influence of economic growth on the level of defence expenditure, 3) a feedback between variables analysed and 4) non-existence of any links between anticipated variables [13].…”

Section: Literature Reviewmentioning

confidence: 99%

“…Moreover, defence expenditure causes economic growth in Belgium, Denmark, France, Germany, Italy, the Netherlands and Portugal [13]. The study of Yilgör et al (2014) has revealed that in the long term there exists a relationship between defence expenditure and economic growth [12]. The authors have found that defence expenditure is a factor in economic growth.…”

Section: Literature Reviewmentioning

confidence: 99%

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Structural Trends of Defence Expenditure in the Baltic Countries

Dudzevičiūtė¹

2020

Challenges to National Defence in Contemporary Geopolitical Situation

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The paper has investigated the patterns of defence expenditure in the Baltic countries, such as Lithuania, Latvia and Estonia during the period of 2004-2018. Distribution of defence expenditure by main category has been analysed and the main tendencies have been provided. The author has done this by applying total expenditure and decomposition approaches. Firstly, the author has calculated the intensity rate of defence expenditure's structural changes in order to assess which country's defence spending structure has been more dynamic over the period analysed. Secondly, Finger-Kreinin indicator has been used to compare defence expenditure distributions and determine their dissimilarities among the countries under consideration. The author believes that the research highlights key structural trends of defence expenditure and could be helpful for policy makers.

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Section: Literature Reviewmentioning

confidence: 98%

Section: Literature Reviewmentioning

confidence: 99%

Section: Literature Reviewmentioning

confidence: 99%

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Structural Trends of Defence Expenditure in the Baltic Countries

Dudzevičiūtė¹

2020

Challenges to National Defence in Contemporary Geopolitical Situation

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“…Literature review part is divided in to two parts as impact of military expenditure on economic growth of developed countries and impact of military expenditure of developing countries. Yilgör, Karagöl, and Saygili (2014) conducted research related to the effect of arms spending on the economic growth of 11 developed countries (USA, Germany, Belgium, UK, Italy, Canada, Norway, Denmark, France, Netherlands, andPortugal) from 1980-2007. By the help of the Granger causality test, it is found that defense expenditure is a factor in economic growth or it justifies the hypothesis which claims that defense expenses by developed countries directly contributes to their economics and according to the Pedroni cointegration test long-term association exists within economic growth and military expenditure. Khalid and Razaq (2015) launched research which investigated the association between arms expenses and economic growth of United State of America (USA) by using the Autoregressive Distributed Lag (ARDL) testing method to cointegration test for the period from 1970-2011.…”

Section: Literature Reviewmentioning

confidence: 99%

Impact of Military Expenditure on Economic Growth of Afghanistan

2020

aijefr

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This empirical study estimates and considers the impact of military expenditure on economic growth of Afghanistan for the period of 2004-2018 by applying the VAR model and VAR Granger causality (1980). The model is run by having the dependent (predicted) variable of economic growth and independent variable of military spending and employment. Ultimately, this analysis revealed that arm expenses do not have a significant effect on the economic growth of Afghanistan for the 15 years period from 2004-2018. And after running the VAR Granger causality it revealed that if some policy changes accrue to the GDP or economic then it will cause the military expenditure (unidirectional causality) and policy changes to the military expenditure will not cause GDP. According to the joint test, it is seen that if some policy changes accrue to the employment and military expenditure so it will cause GDP, if some policy changes accrue to the employment and GDP so it will cause military expenditure.

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“…The literature on military spending and its effect on economic variables can be classified into two hypotheses. The first hypothesis deals with military spending-growth nexus (e.g., Hooker and Knetter 1997 ; Alptekin and Levine 2012 : Dunne and Tian 2013 ; Yilgör et al 2014 ; Dimitraki and Ali 2015 ). The second hypothesis considers military spending-income inequality nexus (e.g., Ali 2012 ; Kentor et al 2012 ; Elveren 2012 ; Wolde-Rufael 2016 ).…”

Section: Introductionmentioning

confidence: 99%

Militarism and globalization: Is there an empirical link?

Irandoust

2017

Qual Quant

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Despite the fact that previous studies have extensively investigated the causal nexus between military expenditure and economic growth in both developed and developing countries, those studies have not considered the role of globalization. The aim of this study is to examine the relationship between militarism and globalization for the top 15 military expenditure spenders over the period 1990–2012. The bootstrap panel Granger causality approach is utilized to detect the direction of causality. The results show that military expenditure and overall globalization are causally related in most of the countries under review. This implies that countries experiencing greater globalization have relatively large increases in militarization over the past 20 years. The policy implication of the findings is that greater military spending by a country increases the likelihood of military conflict in the future, the anticipation of which discourages globalization.

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Panel Causality Analysis Between Defence Expenditure and Economic Growth in Developed Countries

Cited by 47 publications

References 14 publications

Structural Trends of Defence Expenditure in the Baltic Countries

Structural Trends of Defence Expenditure in the Baltic Countries

Impact of Military Expenditure on Economic Growth of Afghanistan

Militarism and globalization: Is there an empirical link?

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