Defence spending and economic growth: A causal analysis for Greece and Turkey*

There are a number of studies which consider the relation between military spending and economic growth using Granger causality techniques rather than a well‐defined economic model. Some have used samples of groups of countries, finding no consistent results. Others have focused on case studies of individual countries, which has the advantage of the researchers bringing to bear much more data than the cross country samples and a greater knowledge of the structure of the economy and the budget. This paper adds to the literature by providing an analysis of two countries, Greece and Turkey, which are particularly interesting case studies given their high military burdens, the poor relations between the two and the resulting arms race in the area. In addition to analysing the data using standard “pre‐cointegration” Granger causality techniques, this paper employs modern vector autoregressive (VAR) methodology that utilises cointegration via Granger's representation theorem. The standard Granger causality tests suggest a positive effect of changing military burden on growth for Greece, but this is not sustained when the cointegration between output and military burden is taken into account. The only evidence of significant Granger causality is a negative impact of military burden on growth in Turkey.     

NUCLEAR ISLANDS

Current International Atomic Energy Agency safeguards do not provide adequate protection against the diversion to military use of materials or technology from certain types of sensitive nuclear fuel cycle facilities. In view of highly enriched uranium's relatively greater ease of use as a nuclear explosive material than plutonium and the significant diseconomies of commercial spent fuel reprocessing, this article focuses on the need for improved international controls over uranium enrichment facilities as the proximate justification for creation of an International Nuclear Fuel Cycle Association (INFCA). In principle, the proposal is equally applicable to alleviating the proliferation concerns provoked by nuclear fuel reprocessing plants and other sensitive nuclear fuel cycle facilities. The INFCA would provide significantly increased nonproliferation assurance to its member states and the wider international community by holding long-term leasehold contracts to operate secure restricted zones containing such sensitive nuclear facilities.     

THE EFFECTS ON SOUTH ASIA OF DEEP US NUCLEAR REDUCTIONS

Significant nuclear reductions by the United States can affect other states in one of five ways: by directly altering their strategic calculations and postures; by indirectly altering their strategic calculations and postures by affecting the behavior of third-party states; by undermining formal US deterrence commitments; by eroding the United States's perceived ability to provide “informal” deterrence through the maintenance of an active global presence; and by creating normative pressure for states to emulate US nuclear reductions. Only the erosion of “informal” deterrence is likely to affect South Asia; to the extent that significant US nuclear reductions affect South Asia, then, their impact is likely to be destabilizing.     

Aligning national “logics” in a European military helicopter program

This article analyzes the public side of the NH90 network consisting of four participating countries (Germany, France, Italy, and the Netherlands) and their industrial partners. Comparable to observations in earlier international projects in the defense sector, the development and production of the NH90 defense helicopter did not match original plans and costs estimates. On the basis of four mechanisms that were intended to facilitate the cooperation between the partnering countries (the General Memorandum of Understanding; coalition formation; the role of the central agency; and the process of vertical escalation) the question is posed whether or not there was a true alignment of national interests and “logics.” The lack of standardization, as well as program delays and issues concerning the division of the work-share, lead to the emerging alignment being characterized as “quasi-alignment” at best.     

JUST WAR AND CYBERWAR

My aim in this paper is to reflect on a very narrow question: under what conditions might a cyber-attack provide a just cause for war? I begin by articulating what makes for a just cause, briefly address the problem of attribution, and then discuss three broad categories of cyber-attack: those that clearly do not satisfy the just cause requirement, those that clearly do satisfy the just cause requirement, and three ambiguous cases – the destruction of property, the emplacement of logic bombs, and the failure to prevent cyber-attacks. My conclusions are exploratory and suggestive rather than definitive, partly by virtue of the extreme paucity of literature on the moral assessment of cyberwar.     

The next step in Somalia: exploiting victory,post-Mogadishu

From 2006 to 2011, al-Qaeda's East African proxy, al-Shabaab, served as the de facto ruling party of Somalia despite the efforts of the internationally recognised Transitional Federal Government (TFG). During these five years, a violent struggle between al-Shabaab and the peacekeeping force of the African Union Mission in Somalia (AMISOM) resulted in thousands of dead civilians, hundreds of thousands of internally displaced persons and a strategic environment inhospitable to reconciliation, recovery or development. By 2012, AMISOM was able to break the deadlock and force al-Shabaab from Mogadishu and Kismayo. In order to continue the momentum, the African Union and other partner nations must support the TFG in neutralising al-Shabaab throughout Somalia and providing good governance to its constituents. Al-Shabaab's revenue streams must be shut down and its offensive capability must be degraded while the strategic environment is shaped to ensure that conditions conducive to a revival do not exist. Failure to do so will likely see Somalia continuing to produce Islamist extremists and pirates to menace international maritime traffic in the western Indian Ocean, destabilise East Africa and adversely impact millions.     

The Odyssey of the Comprehensive Nuclear-Test-Ban Treaty

This study examines the failures of the William J. Clinton and Barack Obama administrations to secure ratification of the Comprehensive Nuclear-Test-Ban Treaty (CTBT). It applies an integrated analytical framework for assessing treaty ratification that builds upon previous research in order to understand why the Clinton administration failed to achieve CTBT ratification in 1999 and why the Obama administration has so far failed to advance the treaty in the Senate. The study concludes that CTBT ratification, despite Obama administration pledges of support, remains highly unlikely. Finally, the study analyzes the common domestic political factors present in both cases and suggests areas for further research.     

Changing the paradigm: Simulation,now a method of first resort

Decades ago, simulation was famously characterized as a “method of last resort,” to which analysts should turn only “when all else fails.” In those intervening decades, the technologies supporting simulation—computing hardware, simulation‐modeling paradigms, simulation software, design‐and‐analysis methods—have all advanced dramatically. We offer an updated view that simulation is now a very appealing option for modeling and analysis. When applied properly, simulation can provide fully as much insight, with as much precision as desired, as can exact analytical methods that are based on more restrictive assumptions. The fundamental advantage of simulation is that it can tolerate far less restrictive modeling assumptions, leading to an underlying model that is more reflective of reality and thus more valid, leading to better decisions. Published 2015 Wiley Periodicals, Inc. Naval Research Logistics 62: 293–303, 2015     

Auctions in the post‐change‐order period

A change order is frequently initiated by either the supplier or the buyer, especially when the contract is long‐term or when the contractual design is complex. In response to a change order, the buyer can enter a bargaining process to negotiate a new price. If the bargaining fails, she pays a cancellation fee (or penalty) and opens an auction. We call this process the sequential bargaining‐auction (BA). At the time of bargaining, the buyer is uncertain as to whether the bargained price is set to her advantage; indeed, she might, or might not, obtain a better price in the new auction. To overcome these difficulties, we propose a new change‐order‐handling mechanism by which the buyer has an option to change the contractual supplier after bargaining ends with a bargained price. We call this the option mechanism. By this mechanism, the privilege of selling products or services is transferred to a new supplier if the buyer exercises the option. To exercise the option, the buyer pays a prespecified cash payment, which we call the switch price, to the original supplier. If the option is not exercised, the bargained price remains in effect. When a switch price is proposed by the buyer, the supplier decides whether or not to accept it. If the supplier accepts it, the buyer opens an auction. The option is exercised when there is a winner in the auction. This article shows how, under the option mechanism, the optimal switch price and the optimal reserve price are determined. Compared to the sequential BA, both the buyer and the supplier benefit. Additionally, the option mechanism coordinates the supply chain consisting of the two parties. © 2015 Wiley Periodicals, Inc. Naval Research Logistics 62: 248–265, 2015