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The improvement in the efficiency of public management leads to an increase in the quality of services, boosting confidence in institutions and thus generating a multiplier effect. This paper aims to update the literature on the data envelopment analysis (DEA), which uses a frontier methodology, for measuring the efficiency applied to the defence sector.

Two main research areas are related through this study: Defence Economics and Efficiency and Productivity Analysis. The frontier methods for measuring technical efficiency are grouped into parametric, non-parametric and semi-parametric. The DEA literature review in the selected sector allows to identify three main fields of work that are discussed in detail.

Existing empirical research has hardly applied bootstrapping methods to remove bias from the estimates. No empirical work has applied an analysis of efficiency determinants by the inclusion of exogenous variables.

The managerial implications of efficiency are numerous. A line of research is proposed to examine the extent to which efficiency improvements have an impact on reputation and, therefore, on the image of and confidence in institutions. The link between Defence Economics and Corruption Economics is also considered.

La mejora de la eficiencia de la gestión pública conduce a un aumento de la calidad de los servicios, impulsando la confianza en las instituciones y generando así un efecto multiplicador. El presente trabajo tiene por objeto actualizar la literatura sobre la metodología frontera de medición de la eficiencia DEA, aplicada al sector de la Defensa.

A través de este estudio, se relacionan dos áreas principales de investigación: Economía de la Defensa y Análisis de Eficiencia y Productividad. Los métodos frontera para medir la eficiencia técnica se agrupan en paramétricos, no paramétricos y semiparamétricos. La revisión de la literatura DEA en el sector seleccionado permite identificar tres campos de trabajo principales que se discuten en detalle.

La investigación empírica existente apenas ha aplicado métodos bootstrap para eliminar el sesgo de las estimaciones. Ningún trabajo empírico ha aplicado un análisis de determinantes de la eficiencia mediante la inclusión de variables exógenas.

Las repercusiones de la eficiencia en la gestión son numerosas. Se propone una línea de investigación para examinar en qué medida las mejoras de la eficiencia repercuten en la reputación y, por consiguiente, en la imagen y la confianza en las instituciones. También se considera el vínculo entre la Economía de la Defensa y la Economía de la Corrupción.

States that the end of the Cold War created expectations of a peace dividend. Analyses and critically evaluates the set of myths about this dividend which emerged. Reviews the response of defence industries to disarmament and provides evidence from the UK.

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.

Following the Gulf War, international discussions took place about multilateral restraints on “destabilising arms transfers”. Given that the UK is one of the leading exporters of arms, any reduction in such exports would affect the UK economy. The UK government spends considerable sums promoting such exports and it benefits from defence exports as they reduce the Ministry of Defence’s procurement costs. This paper analyses the direct financial implications of arms exports to the UK government, both as a buyer of defence equipment and as a promoter of such exports. The results suggest that in the UK each job generated by arms exports is subsidised by just under £2,000 per annum and that a one‐third reduction in UK defence exports would save the taxpayer some £76 million per annum (at 1995 prices).

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.

This paper aims to contribute to the literature on the changing role of the defence sector in the economy at industry and enterprise levels focusing on defence‐civilian cooperation and defence supply networking with foreign industry enterprises from complex industry‐perspective.

Measuring is based on the comparative industry data and the unique survey evidence for the Slovenian defence industry enterprises to derive managerial and policy implications.

The role of the defence industry in the economy declined, but trade deficits from arms and ammunition increased. The industry enterprises can gain from defence‐civilian cooperation and defence supply chain networking with foreign industry enterprises. Information‐coordination institutions are seen to provide opportunities for future industry development in Slovenia.

This research focuses on Slovenia. Future enhancement of the research would be to look into the possibility of applying the findings to other countries. The size of the enterprise, and even more the size of the country, does matter in the defence‐market chain activities.

The proposed industry firm‐level survey approach provides useful policy and managerial implications in the evaluation of defence industry supply and market chain cooperation and networking activities with foreign industry enterprises. The study proves the usefulness of the results, both to the future organizational development and as a decision‐making tool in the complex industry systems.

This paper adds to the industry firm‐level analyses as data management tools for evaluating the defence‐civilian cooperation and networking of complex industry market chain activities for more effective management.

The purpose of this paper is to introduce cybernetic systems in defence management applications, to meet new challenges of the information society and use of system modelling for decision making.

The paper defines basic terms for understanding the complexity of the defence management applications, which is simplified using input‐output modelling.

The paper illustrates the interdisciplinary nature of cybernetics, systems and management sciences. The defence system is analysed and a general input‐output model for defence system development recommended.

New data technology and data availability provide perspective for applied research using scientific approach.

Cybernetic systems for defence provide analytical modelling for management applications.

The paper presents a concept and empirical evidence for defence system analysis and a new way of thinking that affects defence planning and defence management. A cybernetic, systemic and input‐output methodology provides solutions for defence management applications.

In all European national defense‐sector industries, organizational efficiency forms a vital component of the operations that improves competitiveness in the market. The Portuguese government subsidizes companies that are active in this sector in its mission for the companies to achieve improved operational competitiveness, thereby increasing exports and, consequently, become profitable. The policy of subsidization is intended to provide incentives for increasing productive efficiency, which, in the long run, would contribute to the defense industry sharing in the social gains in the form of greater employment and local development. The issue considered in this paper is whether government subsidies have, in fact, resulted in an increase in the technical efficiency and allocative efficiency of the Portuguese defense‐sector companies. The results are, at best, mixed, leading to the conclusion that the incentive regulation carried out by the Ministry of Defense is not achieving its aims. Therefore, a policy revision to enforce efficiency is proposed, based on a governance environment framework.

This paper aims to contribute to the debate of knowledge spillover by presenting a new application for the approach of the technological innovation system (TIS).

Based on the evolutionary economics of the TIS approach, a new framework for knowledge spillover is built and applied to a case. To collect data in studying the case, a mix of quantitative–qualitative methods are used.

TIS approach can help build a framework to analyze knowledge spillover from defense to the civil sector. This framework shows the direct relationship between the functional dynamics of the system and the spillover mechanism..

Sharing the same weakness as TIS, the suggested framework does not pay attention to the contextual factors.

This framework is an analytical tool. It could be used for educational and research purposes, but it has limited power to devise policy guidelines.

This framework is an analytical tool. It could be used for educational and research purposes. But it has limited power to devise policy guidelines.

The paper deviates from the conventional literature of knowledge spillover which uses national level of system analysis. Based on TIS, it adds a new perspective to the literature which had suffered from a limited value of generalizability.

A deteriorating security situation and an increased need for defence equipment calls for new forms of collaboration between Armed Forces and the defence industry. This paper aims to investigate the ways in which the accelerating demand for increased security of supply of equipment and supplies to the Armed Forces requires adaptability in the procurement process that is governed by laws on public procurement (PP).

This paper is based on a review of current literature as well as empirical data obtained through interviews with representatives from the Swedish Defence Materiel Administration and the Swedish defence industry.

Collaboration with the globalized defence industry requires new approaches, where the PP rules make procurement of a safe supply of defence equipment difficult.

The study's empirical data and findings are based on the Swedish context. In order to draw more general conclusions in a defence context, the study should be expanded to cover more nations.

The findings will enable the defence industry and the procurement authorizations to better understand the requirements of Armed Forces, and how to cooperate under applicable legal and regulatory requirements.

The paper extends the extant body of academic knowledge of the security of supply into the defence sector. It serves as a first step towards articulating a call for new approaches to collaboration in defence supply chains.