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1 – 10 of 20Nusrate Aziz and M. Niaz Asadullah
While the relationship between military expenditure and economic growth during the Cold War period is well-researched, relatively less is known on the issue for the post-Cold War…
Abstract
Purpose
While the relationship between military expenditure and economic growth during the Cold War period is well-researched, relatively less is known on the issue for the post-Cold War era. Equally how the relationship varies with respect to exposure to conflict is also not fully examined. Therefore, the purpose of this paper is to investigate the causal impact of military expenditure on growth in the presence of internal and external threats for the period 1990-2013 using data from 70 developing countries.
Design/methodology/approach
The main estimates are based on the generalized method of moments (GMM) regression model. But for comparison purposes, the authors also report estimates using fixed and random effects as well as pooled cross-section regressions. The regression specification accounts for non-linear effect of military expenditure allowing for interaction with conflict variable (where distinction is made between external and internal conflict).
Findings
The analysis indicates that methods as well as model specification matter in studying the effect of military spending on growth. Full sample estimates based on GMM, fixed, and random effects models suggest a negative and statistically significant effect of military expenditure. However, fixed effects estimate becomes insignificant for low-income countries. The effect of military spending is also insignificant in the cross-sectional OLS model if conflict is not considered. When the regression model additionally controls for conflict, the effect of military spending conditional upon (internal) conflict exposure is significant and positive. No such effect is present conditional upon external threat.
Research limitations/implications
One important limitation of the analysis is the small sample size – the authors had to restrict analysis to 70 low and middle-income countries for which the authors could construct post-Cold War panel data on military expenditure along with information on armed conflict exposure (the later from the Uppsala Conflict Data Program, 2015).
Originality/value
To the best of the author’s knowledge, this is the first paper to examine the joint impact of military expenditure and conflict on economic growth in post-Cold War period in a sample of developing countries. Moreover, an attempt is made to review and revisit the large Cold War literature where studies vary considerably in terms findings. A key reason for this is the somewhat ad hoc choice of econometric methods – most rely on cross-section data and rarely conduct sensitivity analysis. The authors instead rely on panel data estimates but also report results based on naïve models for comparison purposes.
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Christos Kollias and Panayiotis Tzeremes
Using composite indices, the paper examines the nexus between militarization, globalization and liberal democracy. The democratic peace theory, the conflict inhibiting effects of…
Abstract
Purpose
Using composite indices, the paper examines the nexus between militarization, globalization and liberal democracy. The democratic peace theory, the conflict inhibiting effects of international trade – a key and dominant facet of globalization – and the democracy promoting globalization hypothesis form the theoretical underpinnings of the empirical investigation.
Design/methodology/approach
To probe into the issue at hand, the paper adopts a dynamic panel VAR estimation procedure. Given the usual data constraints, the sample consists of 113 countries, and the estimations span the period 1995–2019.
Findings
The findings from the dynamic panel VAR estimations suggest the presence of a negative and statistically significant nexus between the level of globalization and the level of militarization. No statistically traceable nexus between globalization and liberal democracy was found.
Research limitations/implications
The findings offer empirical support to the hypothesis that the strong links of interdependence shaped by globalization reduce the need for military preparedness. The results lead to a tentative inference in favor of the doux commerce thesis. Nonetheless, given that the estimations span a historically specific period – the entire post-bipolar era – the inferences that stem from the findings should be treated with caution.
Originality/value
To the best of the authors’ knowledge, the composite indices Bonn International Centre for Conflict Studies (BICC) militarization index, the globalization index of the Swiss Economic Institute (Konjunkturforschungsstelle) (KOF), LibDem, polyarchy have not hitherto been jointly used in previous studies to examine the nexus between militarization, globalization and liberal democracy.
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This paper empirically tests the relationship between conflict and trade in Nigeria from 1986 to 2017.
Abstract
Purpose
This paper empirically tests the relationship between conflict and trade in Nigeria from 1986 to 2017.
Design/methodology/approach
This study made use of secondary data. Time-series data were collected from CBN Statistical Bulletin, WDI of the World Bank, MEPV of the Centre for Systemic Peace database, Stockholm International Peace Research Institute, political risk ratings of the ICRG, Freedom in the World Country Ratings of Freedom House, and ACLED database. This study used descriptive and econometrics techniques to analyze the data. It adopted the IV-GMM techniques.
Findings
The study found that domestic trade has a negative and significant effect on internal conflict in Nigeria. International trade, on the other hand, does not affect internal conflict. In addition, the interaction of trade and institutions shows that more civil liberties (CL) and lower corruption (COR) complement the effect of domestic and international trade in reducing hostilities in Nigeria over the study period.
Research limitations/implications
The main limitation of this study is the inaccessibility of data. This study could not access the data on the volume of domestic trade in Nigeria. The study employed value-added tax on all domestic transactions in Nigeria as a proxy for domestic trade in the country. The study recommends that further studies should access the data on the volume of domestic trade as this could help further understand the relationship between domestic trade and internal conflict in Nigeria.
Practical implications
Since the improved domestic trade reduces internal conflict in Nigeria, the government should formulate policies that facilitate trade. Improving anti-graft efforts and CL will ease the process of formulating trade policies and increase the impact of domestic trade on internal conflict. Furthermore, these will reduce trade barriers and transaction costs. This can be achieved if the government strengthens its anti-COR agencies by making them more autonomous. CL can also be increased by enhancing voice and accountability in the country.
Originality/value
This study advances the literature by examining the role political–institutional quality plays in the relationship between trade and conflict.
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This article examines the relation between measures of military affairs (such as its budgetary cost and the size of armed forces) and measures of human development (such as…
Abstract
This article examines the relation between measures of military affairs (such as its budgetary cost and the size of armed forces) and measures of human development (such as education, health, freedom, and income). The article's major innovation concerns the separation of data by groups of countries. Across a variety of statistical specifications, I find that the statistical relation between military and human development variables is inconclusive, except for the case of the industrialized nations where a clear negative relation emerges. A discussion of the findings, aimed at the public policy-maker, concludes the article.
Nikolaos Grigorakis and Georgios Galyfianakis
The empirical analysis dealt in this paper emphasizes on the impact of military expenditures on out of pocket (OOP) healthcare payments. A sizeable body of defence economics…
Abstract
Purpose
The empirical analysis dealt in this paper emphasizes on the impact of military expenditures on out of pocket (OOP) healthcare payments. A sizeable body of defence economics literature has investigated the trade-off between military and public health expenditure, by testing the crowding-out or growth-stimulating hypothesis; does military expenditure scaling up crowd-out or promote governmental resources for social and welfare programs, including also state health financing?
Design/methodology/approach
In this study, panel data from 2000 to 2018 for 129 countries is used to examine the impact of military expenditure on OOP healthcare payments. The dataset of countries is categorized into four income-groups based on World Bank's income-group classification. Dynamic panel data methodology is applied to meet study objectives.
Findings
The findings of this study indicate that military expenditure positively affects OOP payments in all the selected groups of countries, strongly supporting in this way the crowding-out hypothesis whereby increased military expenditure reduces the public financing on health. Study econometric results are robust since different and alternative changes in specifications and samples are applied in our analysis.
Practical implications
Under the economic downturn backdrop for several economies in the previous decade and on the foreground of a potential limited governmental fiscal space related to the Covid-19 pandemic adverse economic effects, this study provides evidence that policy-makers have to adjust their government policy initiatives and prioritize Universal Health Coverage objectives. Consequently, the findings of this study reflect the necessity of governments as far as possible to moderate military expenditures and increase public financing on health in order to strengthen health care systems efficiency against households OOP spending for necessary healthcare utilization.
Originality/value
Despite the fact that a sizeable body of defence economics literature has extensively examined the impact of military spending on total and public health expenditures, nevertheless to the best of our knowledge there is no empirical evidence of any direct effect of national defence spending on the main private financing component of health systems globally; the OOP healthcare payments.
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This article begins with a discussion of the various costs which occur as a result of armed conflict. It then examines the alternative ways in which wars can be financed. Sri…
Abstract
This article begins with a discussion of the various costs which occur as a result of armed conflict. It then examines the alternative ways in which wars can be financed. Sri Lanka's military expenditure increased six fold, in real terms, between 1981 and 1991. This increase appears to have been financed principally from a reduction in capital expenditures and by a diversion of expenditures away from Economic Affairs and Services, and within this category, especially agriculture. The implications for economic growth are examined. It is estimated that the conflict is resulting in a reduction in the rate of growth of GDP by half a percent per annum.
Christos Kollias and Suzanna‐Maria Paleologou
The purpose of this paper is to investigate the relationship between growth, investment and military expenditure in the case of the European Union‐15.
Abstract
Purpose
The purpose of this paper is to investigate the relationship between growth, investment and military expenditure in the case of the European Union‐15.
Design/methodology/approach
The paper uses fixed panel models, random coefficient models and a trivariate VAR model to examine empirically the relationship between these three macroeconomic variables.
Findings
The results obtained and reported herein show a significant positive effect of the growth rate on the share of military expenditure and on the share of investment. However, on the whole, the findings do not seem to point to any consistent quantitative relation between defence spending and either growth or investment. Thus, they appear to be in line with the findings of other studies.
Originality/value
The economic effects of military spending have drawn considerable attention. Demand side effects on capacity utilisation are one possible channel through which the economy can be positively affected by such expenditure. On the other hand however, reduced investment and capital stock have been reported as a possible negative economic impact of defence outlays that can more than offset any growth inducing effective demand stimulation. The paper attempts a simultaneous assessment of the impact of defence expenditure on both growth and investment for the EU‐15, something that has not been tried before.
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Robert E. Looney and Peter C. Frederiksen
This paper examines the relationship between defense spending and budgetary allocations to various programs for twelve Middle Eastern and North African/Mediterranean countries in…
Abstract
This paper examines the relationship between defense spending and budgetary allocations to various programs for twelve Middle Eastern and North African/Mediterranean countries in an attempt to see if spending patterns vary systematically with changes (both anticipated and unanticipated) in the budget deficit or defense expenditures. Detailed results are presented for Syria and Oman although general patterns are discussed for all countries. Not surprisingly, we found that budget tradeoffs are complex and reflect different priorities across countries. Increases in deficits can either offset or reinforce changes in defense spending. Defense and socio-economic tradeoffs vary considerably depending on whether the country spends relatively a lot or little on defense. We conclude that there are probably some long-run costs associated with sample countries cutting growth intensive programs to accommodate defense.
The article offers a study of the central food marketplace in Santiago, Dominican Republic. The purpose of the study is to explore how changes in the marketplace reflect…
Abstract
Purpose
The article offers a study of the central food marketplace in Santiago, Dominican Republic. The purpose of the study is to explore how changes in the marketplace reflect transformation of urban food systems resulting from neoliberal restructuring during the final decades of the twentieth century.
Design/methodology/approach
Drawing on long-term qualitative research conducted during the late 1990s and early 2000s, including ethnographic and survey methods, the article illustrates how central urban marketplaces offer a window into transitions in both international and domestic food economies.
Findings
Research findings illustrate that the marketplace in Santiago operated in a state of economic hybridity, intermixing long established regionally produced domestic crops such as yuca, plantains and pigeon peas deeply rooted in Dominican agrarian culture with products dervived from liberalization of the Dominican economy such as imported rice, beans and eventually numerous Dominican food staples.
Research limitations/implications
The study is limited by the scope of analysis which is one urban marketplace. More sites for researching marketplaces could be added for more comparative analysis.
Practical implications
The research findings have implications for how governments define social and economic policy that impacts domestic food producers and intermediary brokers that aggregate and debulk food to feed cities.
Originality/value
The scholarship raises questions about how the social and economic organization of urban marketplaces in the Dominican Republic and elsewhere reflect historical transitions in local, national and global economies.
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José Aguado-Romero, Antonio M. López-Hernández and Simón Vera-Ríos
In Spain contract auditing has been applied since 1988 to determine the final cost of defense procurement contracts. In this respect, the Spanish Department of Defense takes the…
Abstract
In Spain contract auditing has been applied since 1988 to determine the final cost of defense procurement contracts. In this respect, the Spanish Department of Defense takes the US methodology as a reference model, and therefore it may be useful to study the degree of convergence between the two models. The main objective of this paper is to analyze the degree to which the US contract auditing model for the procurement of defense materiel has influenced the system applied in Spain. Accordingly, the comparative method is used to highlight the main features of the contract auditing models used by the Spanish and the US Departments of Defense. The results obtained show that the methodology used by Spain is not an original approach, but that there is only a low degree of convergence with the US model.