The Impact of the Military Expenditure and Security Expenditure Structure on the Security Stability

Abstract

<p>The structure of defense spending in Indonesia State Budget consists of three types of spending, which are routine expenditure, goods expenditure, and capital expenditure. It shows the changes in consumption expenditure contribution, direct investment expenditure, and indirect investment from the government. According to The Global Competitiveness Report 2016-2017, Indonesia presents a low level of security stability among 138 countries. Due to the terrorism threat, Indonesia is ranked 115 (Global Competitive Index or GCI=4,2) for business cost, at the 102nd ranking (GCI=3,9) for the business cost caused by crime and violence, and 108th ranking (GCI=4,1) for organized crime. This study aims to examine the impact of military expenditure on security stability in Indonesia. The analytical method used in this study is explanatory, it aims to explain the causal relationship between variables and hypothesis testing. This study employs the time series data with per semester data series through 2000-2018. The research model is formulated as a recursive linear model in the form of a Cobb-Douglas production function and analyzed using multiple linear regression analysis with the Ordinary Least Square method. The result reveals that both military expenditure and security expenditure have impacted simultaneously on security stability. The integration of all components of military expenditure synergistically can increase Security Stability. The components of spending that have a partially significant positive effect on Security Stability are expenditures on goods and capital expenditures.</p>

The Role of Defense Economic in Economic Growth

“…The integration of all components of military expenditure synergistically can increase security stability. The components of spending that have a partially significant positive effect on security stability are expenditures on goods and capital expenditures (Saputro, Mahroza, & Tarigan, 2020).…”

“…The synergy of all components of military spending can increase Security Stability. The components of spending that have a partially significant positive effect on Security Stability are expenditures on goods and capital expenditures (Saputro et al, 2020). The mouth of the puzzle is a geopolitical calculation in which each country determines its threat perception which will then try to be confirmed by looking at the behavior of other countries.…”

Regional Logistics in Improving the Defense Economy in the Region

“…The map functions as a source of information that provides information on regional logistics, with the aim of achieving similarities and understanding in reading a regional logistics map so that national defense can be implemented optimally. The national security system is built with a citizen and community participation approach or a security sector reform agreement, the most important thing is how it affects the Defense-Security Expenditure Structure on security stability in Indonesia (Saputro et al, 2020).…”

The Influence of Budget Planning, Performance Measurement System and Budget Evaluation on the Performance of the Directorate General of Defense Planning

“…The defense budget is an important resource in developing the defense force. The Routine spending, goods spending, and capital spending make up the structure of military spending in the state budget [5]. In conditions of There is no consensus on security stability, strategic industrial growth, or macroeconomic stability; it is unclear what kind of defense security expenditure structure transformation is required to encourage sustainable economic growth and reduce income inequality as a potential threat to national defense and security [6].…”