Does Military Spending Nonlinearly Affect Economic Growth in South Africa?

Using annual data collected from 1988 to 2015, this study provides evidence of a non-linear relationship between military spending, economic growth and other growth determinants for the South African economy. The empirical study is based on estimates of a logistic smooth transition regression (LSTR) model and our empirical results point to an inverted U-shaped relationship between military spending and economic growth for the data. Furthermore, our empirical results suggest that the current levels of military spending, as a component of total government expenditure, are too high in the South African economy and need to be transferred towards more productive non-military expenditure in order to improve the performance of economic growth and other growth determinants.     

某型平显可靠性增长目标可行性论证研究

旨在通过对某型平显可靠性增长目标可行性论证实践,提出以增长曲线趋势来评估研制和小批生产之中产品各阶段可能达到的可靠性水平的预测方法     

Military spending and growth: a small open economy stochastic growth model

The paper analyzes the effects of military spending on economic growth in a small open stochastic endogenous growth model involving the supply-side and demand-side effects produced by military spending. We show that a rise in the military spending affects economic growth through four channels, including the crowding-out effect, the spin-off effect, the resource mobilization effect, and the portfolio effect. The net effect which depends on these four channels is ambiguous. Hence, we demonstrate that there exists an optimal defense burden that maximizes the economic growth rate.     

“Made in China”: an emerging brand in the global arms market

Possession of a brand is a sine qua non for economic success, not least because it connotes trust in delivering the value promised. Although Western arms exporters offer branded systems whose sales are influenced by price, there is a plethora of other economic variables, such as offset requirements and life-cycle support. Entrants to the international arms market will struggle without such arms “packages.” China’s entry, however, goes beyond the traditional economic paradigm. A four-stage historical model offers the backdrop for identifying the drivers that have forged its market entry into 55 countries worldwide. The strategy initially focused on sales of rudimentary military equipment for political purposes, but recently it has begun to commercialize exports, repositioning them from a low- to a high-tech sales trajectory. A Sino “brand” is thus emerging, reflecting both competitiveness and diplomatic considerations, especially non-interference in client state domestic affairs.     

Military Debt: Perspectives from the Experience of Arab Countries

The sectoral production function model of Feder (1983) has been widely used to examine the link between defence spending and economic growth. In this paper, the model, for which too much has been claimed in some past work, is examined, and the case is made for using growth in real non‐defence output rather than growth in real aggregate output (inclusive of military spending) as the dependent variable. Attention is restricted to a small group of OECD countries for which reliable labour force and capital stock (as well as defence) data are obtainable. With non‐defence output as the dependent variable and using only high quality data, no evidence in favour of the underconsumptionist (as opposed to the defence as a burden) position is found.     

Causal analysis of Australian economic growth and military expenditure: A note

Chowdhury (1991) applied Granger causality methods to military expenditure and economic growth series in 55 developing countries. This note applies a similar approach to Australia and finds no causal relationship between military expenditure and growth in either direction.     

Revisiting the Defense–Growth nexus in European countries

This study revisits the long run and dynamic causal linkages between defense spending and economic growth in 15 selected European countries for the period 1988–2010 by utilizing recent developments in non-stationary panel data analysis. To this end, the series properties of per capita defense spending, per capita real capita stocks, and per capita real GDP are investigated by the panel unit root tests with and without breaks that support evidence on unit root. The panel cointegration tests with and without breaks are also subsequently employed to investigate whether there exists a long-run equilibrium relationship between these three variables. Finally, our causality analysis from panel vector error-correction model suggests that there is a feedback relation between real capital stock and real GDP in both short and long run, a one-way Granger causality running from real GDP to defense spending in both short and long run, and defense spending only Granger causes real capital stock in the long run.