Defense spending and economic growth: Extended empirical analysis for the European Union

Previous empirical studies on the defense spending-economic growth nexus such as Kollias et al. (2007 Kollias, C., N. Mylonidis, and S. Paleologou. 2007. “A panel data analysis of the nexus between defense spending and growth in the European Union.” Defense and Peace Economics 18 (1): 75–85.[Taylor & Francis Online], [Web of Science ®] , [Google Scholar]), Mylonidis (2008 Mylonidis, N. 2008. “Revisiting the nexus between military spending and growth in the European Union.” Defense and Peace Economics 19 (4): 265–272.[Taylor & Francis Online], [Web of Science ®] , [Google Scholar]), Dunne and Nikolaidou (2012 Dunne, J. P., and E. Nikolaidou. 2012. “Defense spending and economic growth in the EU15.” Defense and Peace Economics 23 (6): 537–548.[Taylor & Francis Online], [Web of Science ®] , [Google Scholar]) analyzed this relationship in the case of the EU15. This study extends the analysis with the inclusion of more EU members and investigates the long run causal ordering between the two variables. Findings reported herein are not uniformed across all EU members. It is also found that end of Cold War has significant negative impact on defense expenditures of former east-European countries.     

THE FATE OF DISPUTED TERRITORIES: AN ECONOMIC ANALYSIS

This paper presents a simple model to characterize the outcome of a land dispute between two rival parties using a Stackelberg game. Unlike Gershenson and Grossman (2000 Gershenson, D. and Grossman, H.I. 2000. Civil conflict: ended or never ending?. Journal of Conflict Resolution, 44(6): 807–821.  [Google Scholar]), we assume that the opposing parties have access to different technologies for challenging and defending in conflict. We derive the conditions under which territorial conflict between the two parties is less likely to persist indefinitely. Allowing for an exogenous destruction term as in Garfinkel and Skaperdas (2000 Garfinkel, M. and Skaperdas, S. 2000. Conflict without misperceptions or incomplete information: how the future matters. Journal of Conflict Resolution, 44(6): 793–807. [Crossref], [Web of Science ®] , [Google Scholar]), we show that, when the nature of conflict becomes more destructive, the likelihood of a peaceful outcome, in which the territory’s initial possessor deters the challenging party, increases if the initial possessor holds more intrinsic value for the disputed land. Following Siqueira (2003 Siqueira, K. 2003. Conflict and third‐party intervention. Defence and Peace Economics, 14(6): 389–400. [Taylor & Francis Online], [Web of Science ®] , [Google Scholar]), our model has policy implications for peace through third‐party intervention.     

AN ENDOGENOUS GROWTH MODEL OF CAPITAL AND ARMS ACCUMULATION

This paper attempts to examine the effect of an anticipated foreign military threat on the steady‐state growth rate and the transitional behavior of the economy. The modeling strategy follows the Sandler and Hartley (1995 Sandler, T. and Hartley, K. 1995. The Economics of Defense, Cambridge: Cambridge University Press.  [Google Scholar]) and Dunne et al. (2005 Dunne, J.P., Smith, R.P. and Willenbockel, D. 2005. Models of military expenditure and growth: a critical review. Defence and Peace Economics, 16: 449–461. [Taylor & Francis Online], [Web of Science ®] , [Google Scholar]) viewpoints to emphasize the role of national defense in affecting growth from the perspective of both the demand and the supply sides. We thus combine the public capital version of endogenous growth with a framework of competitive arms accumulation. It is found that the key factor determining the steady state and the transitional effects of a rise in the foreign military threat on the home weapon–capital ratio, the consumption–capital ratio, and the rate of economic growth, is the degree of relative risk aversion.     

RAISING THE COST OF REBELLION: THE ROLE OF THIRD‐PARTY INTERVENTION IN INTRASTATE CONFLICT

This paper presents a simple model to characterize explicitly the role that an intervening third party plays in raising the cost of rebellion in an intrastate conflict. Extending the Gershenson‐Grossman (2000 Gershenson, D. and Grossman, H.I. 2000. Civil conflict: ended or never ending?. Journal of Conflict Resolution, 44(6): 807–821.  [Google Scholar]) framework of conflict in a two‐stage game to the case involving outside intervention in a three‐stage game as in Chang et al. (2007b Chang, Y.‐M., Potter, J. and Sanders, S. 2007b. War and peace: third‐party intervention in conflict. European Journal of Political Economy, 23(4): 954–974.  [Google Scholar]), we examine the conditions under which an outside party optimally intervenes such that (i) the strength of the rebel group is diminished or (ii) the rebellion is deterred altogether. We also find conditions in which a third party optimally intervenes but at a level insufficient to deter rebellion. Such behavior, which improves the incumbent government’s potential to succeed in conflict, is overlooked in some conflict studies evaluating the effectiveness of intervention. One policy implication of the model is that an increase in the strength of inter‐governmental trade partnerships increases the likelihood that third‐party intervention deters rebellion.     

Change as a cost driver in defence procurement

This paper discusses change transactions that occur in connection with the procurement of defence systems. The bases for the reasoning are the ideas of Miller and Vollman (1985 Miller JG Vollman TE (1985) The hidden factory – cutting the explosive growth of overhead costs requires mastery of more than just what happens on the shop floor Harvard Business Review Sept–Oct 142 150  [Google Scholar]) and Eppinger (2001 Eppinger DE (2001) Innovation at the speed of information Harvard Business Review January 149 158  [Google Scholar]). These researchers argue that unplanned flows of information lead to change transactions, causing significant overhead costs. According to this paper, change transactions in defence procurement could be caused by (a) the changes in technology taking place during the long lifetime of a defence system and (b) the structure and contents of the agreements between the defence agent (the procurer) and the defence industry (the supplier).     

Ho Chi Minh and the origins of the Vietnamese doctrine of guerrilla tactics

In a very important sense, the Vietnamese military history of the communist era began in 1941, when Ho Chi Minh prepared ‘Guerrilla Tactics’ (Cach Danh Du Kich).1 ?1. Ministry of Defense Center for the Military Encyclopedia Ministry of Defense Center for the Military Encyclopedia. 1996. Tu Dien Bach Hoa Quan Su Vietnam, Hanoi: People's Army Publishing Company.  [Google Scholar], Tu Dien Bach Hoa Quan Su Vietnam, 69. The publication of this essay, which was a manual on the tactics, techniques, and procedures of guerrilla warfare, preceded the founding of the first armed propaganda unit (Tuyen Truyen Doi Vo Trang) on 22 December 1944, which later became the People's Army of Vietnam (PAVN, Quan Doi Nhan Dan); as well as the revolutionary writings of Truong Chinh (1946–1947) and Vo Nguyen Giap (1959). The fact that ‘Tactics’ was published by the Viet Minh reinforces the claim made by the PAVN that it was the first authoritative Vietnamese writing on this important subject.     

Problematising the Role of Private Security Companies in Small Wars

This article sets out to investigate the impact of Private Security Companies (PSCs)1 1. The term PSC is used generically in this article. on civil wars. In doing so, it has taken an historical line, outlining the way the industry has developed from when it first emerged on the international stage in the late 1960s, to the present. Importantly, the article is able to identify three broad strands of involvement in civil wars that include substituting for state military forces, propping up weak governments, and supplementing state militaries. Moreover, in each of these situations, the involvement of PSCs raises both moral and legal questions, as well as challenges for government. This is especially so in light of their activities in Iraq and Afghanistan and the likelihood that governments will increasingly turn to them for niche capabilities.     

The Battle of Mirbat: turning point in the Omani Dhofar rebellion

On 19 July 1972, the pivotal battle of the Dhofar rebellion occurred when over 250 communist guerillas, called adoos,1 ?1. ‘Enemy’ in Arabic. attacked the coastal garrison town of Mirbat2 ?2. Sometimes spelled Marbat. where nine men of the British 22nd Special Air Service Regiment were stationed. Their decisive defense of Mirbat led to decorations three years after the battle, the beginning of the end of the rebellion, and calls for the awarding of Britain's highest honor, the Victoria Cross. The Battle of Mirbat, let alone the Dhofar rebellion are little known outside the UK due3 ?3. Other than papers written for military staff colleges, there is no American written account of the battle. to the covert nature of the SAS deployment, the then Labour government's obsession with secrecy, and the remoteness of the area of operations. Nonetheless, of all the proxy wars of the Cold War this one had the most significance, because had the communist adoos won, Oman and its Musandam Peninsula, which sticks out like a dagger into the Straits of Hormuz and abuts the United Arab Emirates, would have fallen into the communist orbit; threatening the West's oil supply. This is the story of the pivotal battle that was won by Britain and Oman against a communist insurgency.     

Countering global insurgency

This article suggests that the War on Terrorism is actually a campaign against a globalized Islamist 1 1 In this article, the term ‘Islamist’ describes the extremist, radical form of political Islam practiced by some militant groups, as distinct from ‘Islamic’, which describes the religion of Islam, or ‘Muslim’, which describes those who follow the Islamic religion. In this article the term is used to refer primarily to Al Qaeda, its allies and affiliates. View all notes insurgency. Therefore, counterinsurgency approaches are more relevant to the present conflict than traditional terrorism theory. Indeed, a counterinsurgency approach would generate subtly, but substantially different, policy choices in prosecuting the war against Al Qaeda. Based on this analysis, the article proposes a strategy of ‘disaggregation’ that seeks to dismantle, or break, the links in the global jihad.2 2 This article uses the short form of the Islamic term jihad to mean ‘lesser jihad’ (armed struggle against unbelievers), rather than ‘greater jihad’ (jihad fi sabilillah), i.e. moral struggle for the righteousness of God. View all notes Like containment in the Cold War, disaggregation would provide a unifying strategic conception for the war – a conception that has been somewhat lacking to date.     

The Iraq Survey Group: From Weapons of Mass Destruction to Counterinsurgency

The discovery and elimination of Iraq's alleged weapons of mass destruction (WMD) was a focal point of the Coalition's strategy and operations in the aftermath of Operation ‘Iraqi Freedom’. Despite the failure of the WMD mission to meet expectations after almost two years of intensive operations, the Iraq Survey Group (ISG) was able to integrate multinational and multi-agency forces to provide detailed intelligence regarding the history of Iraq's WMD programs and to assist in the battle against insurgents. The ISG's experience raises the question of whether a standing intelligence force could become a key component in future counterproliferation and counterterrorism efforts around the world.1 ¹The views expressed in this paper are those of the author and do not reflect the official policy or position of the Defense Intelligence Agency, the Dept. of Defense, or the US Government. View all notes     

Antelope,Poseidon or a Hybrid: The Upgrading of the British Strategic Nuclear Deterrent, 1970–1974

It is the purpose of this article to illustrate how the British government reached its decision to upgrade the Polaris strategic nuclear deterrent in 1973. Using British and American documentation it is demonstrated that the strategic imperatives for upgrading Polaris were fundamental to the project. Existing accounts of the Polaris Improvement Project, however, have not given the appropriate attention to the wider US–UK political differences in this period. By doing so it is shown how in addition to the wider economic, strategic and political factors, this was of paramount significance in the Heath government opting for the ‘Super Antelope’ method in upgrading Polaris.1 ¹‘Super Antelope’ was the codename for the upgrade of Polaris. This was eventually changed to ‘Chevaline’. Peter Hennessy, Cabinets and the Bomb (Oxford: OUP 2007), 28–9. View all notes     

The Political Economy of Legislation on Terrorism

^{1 1}This research was funded in part by a grant from the Lowe Institute of Political Economy. The corresponding author is S. Brock Blomerg. We thank Chris Blomberg and Brianna Loyosa for their excellent research assistance on the project. This paper presents an empirical analysis of what drives congressional legislation on terrorism during the period 1995 to 2010. We utilize and augment current methodology to compile and analyze data on sponsorship and cosponsorship of terrorism related data. Our results on the sources of legislation on terrorism are largely in line with past examinations of the importance of committee membership and leadership, party majority-ship, and other political factors. Further, we find that the most significant and robust drive for legislation on terrorism is the September 11^th attacks. And while the impact of 9/11 affected legislative productivity everywhere, we find that it most significantly affected states surrounding New York and Washington D.C. Our results indicate that the economy may be one factor motivating politicians to legislate on terrorism; however, these results are not robust.     

Marketing Systems and Insurgency in Western Guatemala

Guatemala is a nation with a history of severe political and socioeconomic problems. These crises contributed to the growth and durability of insurgent movements, which from 1961 to 1996 were endemic in certain regions of the nation, particularly western Guatemala. This paper examines insurgent activity in the four marketing subsystems described by Smith1 ?1. Smith, ‘Marketing Systems’, pp. 117–46. found in western Guatemala: dendritic, primate, top-heavy and interlocking. Peasants are said to be severely disadvantaged in the dendritic marketing systems, disadvantaged in primate markets, and relatively capable of making a decent living in top-heavy and interlocking systems. If this is so, support for system changing revolutionary movements should predictably be highest in dendritic systems, significant in primate systems, and only marginal in top-heavy and interlocking systems. An examination of the political-military situation in western Guatemala from 1976 to 1996 supports this thesis.     

Westmoreland was right: learning the wrong lessons from the Vietnam War

Fourth Generation Warfare is a theory of contemporary warfare that posits a number of different ideas that are able to shed light on current conflicts. Whilst much of the debate has been concentrated on the linear development of warfare and also on analysis of the current situation of US forces in Iraq, it has resonance for a number of different conflicts taking place in Africa, if only because the US has become involved in contemporary conflicts in Somalia and the Mahgreb. There are clearly significant issues with the US-centric, flawed linear approach to history, but the actual analysis of modes of warfare has much to offer policymakers in a continent that is under-represented in the literature, and is also in danger of being forgotten in the shadow of analysis of Iraq. This paper moves on from criticising the stepped approach to history and looks at patterns of warfare in contemporary Africa, arguing that there is much in the theory that could be used to explain seemingly illogical tactics or patterns, and thus has much to tell policymakers engaged in conflict analysis.

Rebellions can be made 2 per cent active in a striking force, and 98 per cent passively sympathetic.1 ?1. T.E. Lawrence, ‘Science of Guerrilla Warfare’, 1929, published in Malcolm Brown (ed) T.E. Lawrence in War and Peace: An Anthology of the Military Writings of Lawrence of Arabia (London: Greenhill Books, 2005) p.284.      

The National Movement for the Liberation of Azawad factor in the Mali crisis

Mali has been a battleground for more than a year now. While the armed conflict came in the aftermath of the Libyan crisis that left the regional security environment depleted, it also served as a catalyst for the collapse of state authority in Mali. This created conditions conducive for the proliferation of, and attacks by, radical religious armed groups in the northern regions of the country, including the Tuareg armed movement: the National Movement for the Liberation of Azawad (MNLA). But, far from being a new phenomenon, the Tuareg-led armed insurrection in the northern regions is as old as the post-colonial Malian state, and continues to pose tremendous challenges in West Africa and the Sahel region for both regional and extra-regional actors. The recent crisis in the Sahel region is seen as one of the most serious since the end of the Cold War, with anticipated dire long-term impacts on the security of the region and beyond. While attention is predominantly focused on defeating the jihadist groups that have threatened the survival of the Malian state, one must not lose sight of the fact that the ‘Tuareg Factor’, as represented by the rebellion launched by MNLA, remains critical both in terms of appreciating the deterioration of the situation and attempting to frame long-lasting solutions. The paper argues that the Tuareg's persistent recourse to rebellion against Bamako needs to be understood within a historical trajectory that takes into consideration three key parameters: firstly, the post-colonial state in Mali and its African leadership's relations with the descendants of the Tuareg communities; secondly, the amalgamation created by the so-called war on terror; and, finally, the contradictions of the democratisation process of the 1990s.¹1 This article is based on field research carried out between 2008 and 2013 on the ‘Resurgence of Tuareg-led Rebellions’.     

India's Tortuous Road to Defence-Industrial Self-Reliance

…Rapid indigenisation is the cornerstone of our policy of self-reliance

India MoD Annual Report 1978–9

     

Blood on the Ground: Canada and the Southern Campaign in Afghanistan

For the Americans, it's no longer just “boots on the ground”: it's blood on the ground that counts.

Joel J. Sokolsky

     

Confidence intervals for ranked means

Suppose that observations from populations π₁, …, π_k (k ≥ 1) are normally distributed with unknown means μ₁., μ_k, respectively, and a common known variance σ². Let μ_[1] μ … ≤ μ_[k] denote the ranked means. We take n independent observations from each population, denote the sample mean of the n observation from π₁ by X _i (i = 1, …, k), and define the ranked sample means X _[1] ≤ … ≤ X _[k]. The problem of confidence interval estimation of μ₍₁₎, …,μ_[k] is stated and related to previous work (Section 1). The following results are obtained (Section 2). For i = 1, …, k and any γ(0 < γ < 1) an upper confidence interval for μ_[i] with minimal probability of coverage γ is (? ∞, X _[i]+ h) with h = (σ/n^1/2) Φ^?1(γ^1/k-i+1), where Φ(·) is the standard normal cdf. A lower confidence interval for μ_[i] with minimal probability of coverage γ is (X _i[i] – g, + ∞) with g = (σ/n^1/2) Φ^?1(γ^1/i). For the upper confidence interval on μ_[i] the maximal probability of coverage is 1– [1 – γ^1/k-i+1]ⁱ, while for the lower confidence interval on μ_[i] the maximal probability of coverage is 1–[1– γ^1/i] ^k-i+¹. Thus the maximal overprotection can always be calculated. The overprotection is tabled for k = 2, 3. These results extend to certain translation parameter families. It is proven that, under a bounded completeness condition, a monotone upper confidence interval h(X ₁, …, X _k) for μ_[i] with probability of coverage γ(0 < γ < 1) for all μ = (μ_[1], …,μ_[k]), does not exist.