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The Asymmetric Relationship Between Military Expenditure, Economic Growth and Industrial Productivity: An Empirical Analysis of India, China and Pakistan Via the NARDL Approach

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  • Aamir Aijaz Syed

Abstract

This research work aims to verify how military expenditure promotes economic growth and industrial productivity, as suggested by the Military Keynesianism postulate. The NARDL method is employed to achieve the above objective on the panel data of India, China, and Pakistan, covering the period between 1990 and 2018. The study finds that the positive and negative impact of military expenditure has a significant positive and negative effect on economic growth in the long run for China and India; however, in the short-run, only positive impact favors economic growth. Thus, there is a symmetric effect in the short-run and an asymmetric impact in the long-run. This asymmetric result supports the work of Military Keynesianism, helping policymakers in devising appropriate macro-economic policies.

Suggested Citation

  • Aamir Aijaz Syed, 2021. "The Asymmetric Relationship Between Military Expenditure, Economic Growth and Industrial Productivity: An Empirical Analysis of India, China and Pakistan Via the NARDL Approach," Revista Finanzas y Politica Economica, Universidad Católica de Colombia, vol. 13(1), pages 77-97, March.
    • Handle: RePEc:col:000443:019655
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    More about this item

    Keywords

    Military Spending; Economic Growth; Asymmetric; NARDL; Military Keynesianism.;
    All these keywords.

    JEL classification:

    • E6 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook
    • F5 - International Economics - - International Relations, National Security, and International Political Economy
    • O3 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights

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