Arms trade,arms control,and security: Collective action issues

This article puts forth collection action as a unifying theme for the conference essays on arms trade, control, and production. For each of these topics, collective action failures are related to group size and group composition considerations. Other issues are also examined including the manner in which individual contributions determine the overall level of the associated collective good ‐ the so‐called aggregation technology of public supply. Based on alternative aggregation technologies, the game‐theoretic underpinnings of these arms issues are explored.     

Arms export controls and emerging domestic producers†

The possibility of domestic production raises a difficulty for arms export control measures, since embargoes, by raising the effective price of imports, increase the incentive for domestic production. We address this issue by developing a partial equilibrium model of the international arms market We compare three arms export regimes involving the exporters of high‐technology arms, with a particular focus on the effect of emerging domestic production: laissez‐faire trade, the uncoordinated regulation of exports and a producer cartel consisting of coordinated regulation. The main conclusion is that the possibility of domestic production significantly changes the nature of these stylized export regimes.     

DETERMINING THE DEFENCE INDUSTRIAL BASE

This paper models the determination of the defence industrial base – the number of different military systems a country decides to maintain. High R&D costs means that few countries can afford to produce major weapons systems and the producers also import systems. Non‐producers rely on imports and we assume their demand is driven by regional arms races. Military capability is determined by the number of systems and the quantity and quality of each. We examine how the defence industrial base is influenced by military expenditures, R&D costs, export controls, the nature of regional arms races and a variety of other factors.     

伊拉克战争对中东地区乃至世界军品贸易的影响

在分析了伊拉克战争对中东地区军品贸易影响的基础上,重点分析了其对世界军品贸易的深刻影响———加剧军备竞赛、刺激军工技术发展、引起军贸格局及产品结构发生变化、国际军控形势更加严峻。     

The Determinants of Arms Production

This study analyzes the determinants of arms production in 15 countries using annual panel data from 1997 to 2002. The results suggest that real GDP per capita, military expenditures, arms exports, and arms imports are positively related to arms production.     

The financing factor in military trade

Available sources value transfers of weapons irrespective of whether they are paid for and how. Data from the U.S. indicates that the shares of arms given for free or on credit are high. If other arms exporters, all military aid and all credits used for military purposes are considered, which is done here on the basis of rough estimates and an opportunity cost model, the true cash costs of weapons in the year of the actual transfer are small. On the other hand, the financial burden of earlier arms imports via debt service has grown over time. It most probably exceeded the true cash cost of imports of arms in the late 1980s. Large differences between arms transfer data and the actual true costs of arms transfers means that analysis of the economic effects of arms imports without considering these financial aspects makes little sense.     

Country survey IX: Spain

From the early 1980s Spain embarked on a wide‐ranging process of military reform, from organisational changes to defence industrial policies. Investment in military equipment was set to grow, policies were drawn up to foster the domestic defence industrial base, defence R&D rocketed, and Spain joined a myriad of international arms development programmes. Yet, by 1991 the process of reform had run out of steam. Expenditure planning proved unreliable, and firms suffered from sharp cutbacks in procurement expenditure. The model of defence industrial growth sketched in the mid‐1980s had floundered. The Spanish case provides an example of how the quest to maximise defence procurement from domestic sources can fall victim to industrial and budgetary constraints. Spanish defence producers are now becoming increasingly intertwined with foreign defence companies.     

The impact of arms production on the South African manufacturing industry

The 1977 UN arms embargo was one of the main factors which led South Africa to establish a largely self sufficient import‐substituting arms industry capable of meeting the apartheid state's demand for sophisticated weaponry. While macroeconomic studies suggest that high military spending had a damaging effect on economic growth, no studies have investigated the disaggregated impact of military expenditure on industrial development. This paper applies panel data methods to the Industrial Development Corporation's Sectoral Database in order to analyse the level effects of military spending.     

Arms Racing and the Costs of Arms Imports: A Stochastic Model

The paper draws on the demand for arms imports model of Levine and Smith (1995, 1997) using stochastic processes of the birth-death type in steady state. It assumes two antagonistic regional players engaged in an armaments race satisfying their demand for military hardware through imports from the international market. The paper examines the effects that arms imports have on the military balance between the two recipient countries. It constructs a state space of possible outcomes in terms of the military balance/imbalance between the two countries involved. A new variable is introduced which tries to encapsulate the absolute difference in their respective security functions at any moment in time. This variable affects the transition from one state of affairs to the other.     

An analysis of the Washington naval agreements and the economic provisions of arms control theory

During the Cold War, two contending hypotheses dominated theories concerning the economic impact of anus control. The first suggested that when certain prerequisites were fulfilled, arms control agreements served to promote lasting reduction in military spending. The second asserted that instead of promoting savings, arms control encouraged diversion of resources to more advanced and expensive weapons, thus driving defense spending higher. Through the examination of the impact of the Washington Naval Agreements on naval expenditure during the 1920s, this paper provides empirical evidence to support the latter of these competing hypotheses. The United States, Great Britain, and Japan all realized economic savings after signing the Washington Naval Agreements. However, these savings soon eroded as the powers developed more advanced weapons‐systems.     

The impact of superpower arms transfers on conflict in the Middle East

I explore the relationship between superpower arms transfers and the Arab‐Israeli rivalry. My empirical analysis suggests that Soviet arms transfers to the Middle East, more than American transfers, have exacerbated interstate rivalry in the region. It also suggests that Soviet arms transfers, again more than American transfers, have encouraged compensatory arming by the other superpower. These conclusions derive from the results of cross‐correlation analysis, Granger‐causality tests, and variance decompositions, and are quite robust. While my findings paint a rather unflattering portrait of the effects of superpower involvement in the region, they do constitute grounds for optimism in light of current developments.     

Export controls,market structure and international coordination

We look at the different ways of aggregating the exports of dual use products to give the security perception of exporter countries and their consistency with the relevant export control regimes. Also, we analyze different models of export controls highlighting the role of the perception of security, market structure and competition between exporting firms in determining the existence of multiple equilibria and therefore, the need for coordination between countries in setting export controls.     

FINANCIAL VERSUS HUMAN RESOURCES IN THE GREEK–TURKISH ARMS RACE 10 YEARS ON: A FORECASTING INVESTIGATION USING ARTIFICIAL NEURAL NETWORKS

This paper looks into the Greek–Turkish arms race a decade after an earlier contribution to the issue that relied heavily on artificial neural networks. The time period between the two papers contributes to the reliability of the results derived, not just by increasing the number of observations, but also mainly by incorporating the progress made in the realm of artificial intelligence. The focus on the case of both countries unlike the paper mentioned above that dealt with just the Greek side provides ample room for comparative purposes regarding the determinants of defense expenditure on both sides. The results derived in terms of input significance estimation support the findings of the earlier research as indicated above, pointing to the leading role of the demographic preponderance of Turkey over Greece. The paper also points to the fact that 10 years later, Turkey continues to set the arms race rules against its rival by determining the defense expenditure of Greece, whereas the role of the latter in affecting the military spending of Turkey is non‐existent.     

THE EXERCISE OF NATIONAL SOVEREIGNTY

Skeptics of the Bush administration have castigated its strong aversion to formal international agreements in responding to the threat of the proliferation of weapons of mass destruction (WMD), citing unilateral actions as the default alternative. Yet this critique misses the growing emergence of a conscious framework guiding the administration's actions: an emphasis on the exercise of national sovereignty and the corollary principle of sovereign responsibility. Rejecting the paradigm of arms control as the answer to WMD proliferation, the current administration instead advocates a toolkit of alternative mechanisms based on the full exercise by individual nation, states of their domestic authorities and rights under international law, acting in their capacities as responsible citizens of the global community. This paper will examine that philosophical approach and its concrete application through the following policies: (1) the Proliferation Security Initiative; (2) enforcement of national laws and regulations as exemplified by United Nations Security Council Resolution 1540 and the U.S. proposals for consideration by Biological Weapons Convention signatories; and (3) preemptive warfare to disarm the WMD programs of a threatening state.