Military expenditure and unemployment in the OECD

The effect of military expenditure on employment is a matter of considerable importance. However, few of the standard economic analyses of unemployment take any explicit account of variations in military expenditure in their models. The purpose of this paper is to assess whether the prevalent neglect of this variable in labour economics is justified.

The paper briefly surveys previous estimates made of the employment effects of military expenditure. It then considers evidence from the simple dynamic reduced form regressions estimated on long historical series for the US and the UK and pooled post‐war data for 11 OECD countries. It does not suggest that the share of military expenditure is a significant influence on the unemployment rate. This implies that in analysing unemployment no special account need be taken of military expenditure and that the fear that reductions in the share of military expenditure will be associated with higher average unemployment levels is misplaced.     

The Economic Effect of Military Facility Contraction: A Naval Case Study

The global financial turmoil of 2008 has resulted in the curtailment of military expenditure in most western countries. At a sub-regional-level reductions in the level of activity at a major military facility can have significant economic impact. In the light of this, the paper has two objectives: to analyse the impact of the decision to terminate naval shipbuilding at the United Kingdom’s Portsmouth Naval Base; and, for illustrative purposes, to examine the possible economic consequences of further contraction at the facility. In pursuit of these aims, it is necessary to establish the output, income and employment generated by the base using a bespoke input–output model. The methodology employed can, with appropriate adjustments, be utilised in other military or civilian contexts.     

Military expenditure and employment in South Africa*

Previous research into the impact of military expenditure on employment finds considerable variation across countries. This paper adds to the debate by examining the long run relationship between military burden and manufacturing employment in South Africa. Such an analysis provides an opportunity to test for crowding‐out effects and the impact of the marked decline in military spending on the South African economy. The paper finds evidence supporting the view that military expenditure will have a detrimental impact on long term manufacturing employment, adversely affecting industrial structure and efficiency.     

Gendered divisions of military labour in the British armed forces

This paper examines statistical data on the employment of women in the British armed forces. It reviews some of the issues shaping debates about women’s military employment, in order to establish the on-going significance of the topic. It looks at patterns of female military employment across the three services, and places discussion of this in the context of observations about gendered divisions of labour in the wider UK labour market. It examines data for the gendered divisions of labour within different corps, branches and occupational groups within each of the three armed services, and looks at gender patterns across ranks. It concludes by discussing the implications of these findings for both policy and conceptual work on women’s military participation.     

Allies with Benefits: US Effect on European Demand for Military Expenditures

This paper examines the security relationship between the US and Europe, focusing on potential spillin effects of US military expenditures on European demand for military expenditures during the early twenty-first century. The goal is to test whether or not European states view US expenditures as a complement or as a substitute to their own military expenditures. Past work in this area has found mixed results concerning the effect of US military expenditures, but focus strictly on the spillins within a formal alliance, specifically NATO, and use a time series dominated by Cold War dynamics. This study differentiates itself by accounting for both US total military expenditures and its regional expenditures through incorporation of US military base and personnel deployments across Europe. Additionally, this paper uses government revenue in its estimation to mitigate potential endogeneity. Findings using Arellano–Bond dynamic panel analysis suggest that there is a strong probability of substitution among European states.     

MILITARY EXPENDITURE AND ECONOMIC GROWTH IN MIDDLE EASTERN COUNTRIES: A DYNAMIC PANEL DATA ANALYSIS

Defence expenditures have both costs and benefits to the economy. The costs of defence expenditures are mainly emphasized as opportunity costs. On the other hand, defence spending may have growth‐promoting potential benefits: a rise in defence spending may result in a higher aggregate demand, production and employment. This paper examines empirically the effects of military expenditures on economic growth for Middle Eastern countries and Turkey, for the time‐period 1989–1999. The relationship between military expenditure and economic growth is investigated by using cross‐section and dynamic panel estimation techniques. Empirical analysis indicates that military expenditure enhances economic growth in the Middle Eastern countries and Turkey as a whole.     

BOOK REVIEWS

This study examines how young people who have joined the South African National Defence Force (SANDF) on the two-year Military Skills Development System (MSDS) contract experience military service, and the effect this has on their ability to readapt to civilian life. The first part of the study examines the theoretical debates associated with military socialisation and reintegration into civilian life. Hereafter, the findings are presented in terms of the experiences of MSDS privates serving in the infantry, those that have left, and the perceptions of employment agencies in terms of the marketability of military skills. The conclusion is reached that MSDS members experience their two years in the SANDF as life-changing, that this affects their ability to reintegrate back into civilian society, and that the skills acquired during military training is of limited market value. The conclusion is reached that more needs to be done to assist these young military veterans to adapt to civilian life and to augment their military experience with more marketable skills to enable them to find gainful employment.     

REGIONAL EFFECTS OF MILITARY BASE CLOSURES: THE CASE OF SWEDEN

The purpose of this paper is to investigate regional effects of military base closures in Sweden during the last decades. Our analysis is based on a regional growth model, where two equations are estimated; one equation describing the average income growth rate and one equation describing the net migration rate. The data set is a panel of 31 Swedish municipalities covering the period 1983–1998. Our main finding is that a closure of a military base has not had any significant impact on the subsequent average income growth rate nor the net migration rate in the affected municipalities. One potential explanation for these results relates to the labour market and the composition of the labour force.     

Military expenditures,economic growth and spatial spillovers

The relationship between economic growth and military expenditure has been the subject of a large literature in defence economics. This study analyses the influence of military expenditures on economic growth in a global perspective for the time period 2000–2010 taking spatial dimension into account. The augmented Solow model is employed to investigate the defence-growth nexus using the cross-sectional data relating to 128 countries. Following a traditional regression analysis, spatial variations in the relationships are examined utilizing different spatial econometric specifications estimated by maximum likelihood. The regressions are compared with each other via likelihood ratio tests, and the spatial Durbin model is found to be the most appropriate one suggesting that the typical least-squares model is misspecified. Empirical evidence indicates that military expenditure has a positive effect on economic growth with a significant spatial dependence for the time period under consideration.     

ANALYSING DEFENCE DEPENDENCY: THE IMPACT OF THE ROYAL NAVY ON A SUB‐REGIONAL ECONOMY

This paper provides a methodology for estimating the economic impact of defence spending at a sub‐regional level. It does so by calculating the income and employment generated by Britain’s Royal Navy and associated defence activities in the City of Portsmouth and its surrounding area, during the financial year 2003–2004. In an era of military consolidation, the paper offers an insight into the multifaceted impact of defence‐related expenditure. Hence, it presents a generic framework that could prove useful to other researchers when seeking to measure the sub‐regional impact of naval, airforce and army facilities in other national contexts.     

Does Military Spending Explode External Debt in Pakistan?

This paper investigates the effect of military spending on external debt in case of Pakistan for the period of 1973–2009. For this purpose, the autoregressive distributed lag bounds testing approach to cointegration is used to examine cointegration among the variables. The ADF, P-P, and ADF-GLS unit root tests are applied to test the integrating order of the variables. The Ordinary Least Square (OLS) and error correction method regressions are used to investigate the marginal impact of military spending on external debt in the long and short run. Our findings indicate the existence of cointegration that confirms the presence of a long-run relationship among military spending, external debt, economic growth, and investment. Further, our results reveal that a rise in military spending increases the stock of external debt; an increase in investment also increases external debt; however, there is an inverse effect of economic growth on external debt. An implication of the findings reported herein is that there is a need to formulate a comprehensive economic policy for curtailing external debt in case of Pakistan.     

The impact of military spending cutbacks on economic activity in an incentive‐wage two‐sector aggregative economy∗

We examine the theoretical outcomes of disarmament on economic activity in a two‐sector model of endogenous equilibrium unemployment rate. Three main shocks are analyzed: Exogenous cutbacks in military spending on the capital good and employment, and a reduction in public sector debt. The first shock is contractionary for equilibrium employment if the capital‐goods producing sector is relatively labour‐intensive but expansionary under the alternative factor intensity assumption. The second shock is contractionary for employment under either relative factor intensity assumption. If Ricardian equivalence fails, a reduction in public sector debt is likely to expand long‐term employment (JEL E24).     

A non‐linear defence‐growth nexus? evidence from the US economy

The defense‐growth nexus is investigated empirically using time series data for the US and allowing the effect of defense spending on growth to be non‐linear. Using recently developed econometric methods involving threshold regressions, evidence of a level‐dependent effect of military expenditure on GDP growth is found: the positive externality effect of defense spending prevails for relatively lower levels of defense spending (with respect to the history of defense spending in the US) and reverts its influence for higher levels.     

THE REGIONAL ECONOMIC EFFECTS OF MILITARY BASE REALIGNMENTS AND CLOSURES IN GERMANY

We identify the causal effect of a reduction in military personnel on a number of socioeconomic indicators within the peripheries of military bases. The base realignments and closures in Germany are used as an exogenous source of variation that allows us to identify the effect of a demand shock on household income, output, unemployment, and tax revenue within a specified buffer zone around each base. The analysis covers 298 communities for the period 2003–2007. Consistent with evidence found elsewhere, we find that these base adjustments have only a marginal impact on the local community in which the bases are located.     

The Pervasive Role of Rank in the Health of U.S. Veterans

The following article tests the hypothesis that veterans have better health if they were officers when they were in the U.S. military than if they served in the enlisted ranks. It examines this hypothesis by presenting results from logistic regressions that are based on four surveys: the National Survey of Veterans, the Survey of Retired Military, the Panel Study of Income Dynamics, and the Wisconsin Longitudinal Study. In all four of these surveys, the evidence is consistent with the hypothesis that military rank is associated with health, particularly among veterans who served longer. It also suggests that the health gradient by rank is independent of similar gradients by education and income as well as health differences by race. These findings indicate that health may be influenced not just by differences in civilian society but also by those in the military.     

一种培养创新性人才新模式的有益探索—关于在我院创建军用装备机电技术创新教学/实验基地的构想

在军队工科院校建立机电技术创新教学/实验基地是一项具有深远意义的教学实践的尝试,它有利于开拓一种全新的军队工科课程的教学模式和人才培养模式,对培养学员和研究生的创新能力具有极大的促进作用.主要从以下3个方面对建立机电技术创新教学/实验基地的思路和方案,进行了初步的探讨:国内外军校创新教育的发展现状;在我院开设创新实验的基本思路;建立机电技术创新实验基地的初步规划方案.     

基于改进SLP的军事物流基地设施平面布局研究

由于传统SLP方法的不足,在解决设施较多的军事物流基地布局问题上面临较大困难。为解决此问题,提出了改进SLP方法,以军事物流基地设施间综合相互关系为基础,构建平面布局模型,并确定目标函数和主要约束条件。随后对模型的求解进行遗传算法设计,并运用Matlab编程实现模型的求解,从而得出平面布局的最优解。最后以最优解为基础,结合限制条件进行修正,完成军事物流基地设施平面布局设计。     

Building the sinews of power: India in the Second World War

ABSTRACT

This article analyses the military transformations that India underwent during the Second World War. It focuses on the institutional dimension of these changes and considers the longer-term changes wrought by the war in the composition of the army, the logistical and support infrastructure and the emergence of an indigenous military industrial base. Taken together, the article argues, these changes positioned India as a potential regional military power that was qualitatively different from the interwar period.     

Asia-Pacific Demand for Military Expenditure: Spatial Panel and SUR Estimates

This article investigates the demand for military expenditure for a sample of key Asia-Pacific countries. Spatial panel demand estimates are presented for three joined spatial units using a fixed-coefficient spatial lag model based on a two-step efficient GMM estimator. Spatial autoregression estimates are next presented for 1991–2015, founded on alternative kinds of country connectivities, such as contiguity, inverse distance, discrete distance, and power-projection considerations. Finally, 11 select countries’ demands for defense equations are estimated using seemingly unrelated regressions. From alternative perspectives, these estimated models indicate how Asia-Pacific countries respond to the defense spending of other countries. In the spatial runs, free riding is prevalent despite the growing military might of China, which apparently is not generally viewed as a threat. For the sample period, the projection of Chinese or American power is a relevant spatial factor. The main threat is reflected in non-U.S. allies’ reaction to U.S. allies’ defense spending during 1991–2015 and to Chinese defense spending after 2002.     

Size Still Matters: Explaining Sri Lanka’s Counterinsurgency Victory over the Tamil Tigers

The military effectiveness literature has largely dismissed the role of material preponderance in favor of strategic interaction theories. The study of counterinsurgency, in which incumbent victory is increasingly rare despite material superiority, has also turned to other strategic dynamics explanations like force employment, leadership, and insurgent/adversary attributes. Challenging these two trends, this paper contends that even in cases of counterinsurgency, material preponderance remains an essential—and at times the most important—factor in explaining battlefield outcomes and effectiveness. To test this, the paper turns to the case of the Sri Lankan state’s fight against the Tamil Tiger insurgency, a conflict which offers rich variation over time across six periods and over 25 years. Drawing on evidence from historical and journalistic accounts, interviews, memoirs, and field research, the paper demonstrates that material preponderance accounts for variation in military effectiveness and campaign outcomes (including military victory in the final campaign) better than strategic explanations. Additionally, a new quantitative data-set assembled on annual loss-exchange ratios demonstrates the superiority of materialist explanations above those of skill, human capital, and regime type.