Advanced Search
MyIDEAS: Login to save this book chapter or follow this series

The Econometrics of Military Arms Races

Contents:

Author Info

  • Dunne, J. Paul
  • Smith, Ron P.

Abstract

Arms races - enduring rivalries between pairs of hostile powers, which prompt competitive acquisition of military capability - appear to be a pervasive phenomenon. From the past Cold War competition, between the US and the USSR, to present regional antagonisms, such as India and Pakistan, arms races remain a matter of continuing concern. This chapter reviews the econometric issues involved in estimating models of military arms races, of the competitive acquisition of military capability by hostile powers. As econometrics involves the synthesis of theory, data and statistical methods, in reviewing the econometrics of arms races, as much attention is paid to theory and data as to statistical methods. After discussing the choice of data and the theoretical issues in specification, we then examine four types of model: time-series estimation of classical Richardson type action-reaction models, using India and Pakistan as an example; Markov switching estimation of game-theory type models, using Greece and Turkey as an example; cross-section models and panel models. Our first general conclusion is that the theory suggests that the parameters of arms race interactions are unlikely to be constant over time and the empirical literature largely confirms this. Nonetheless, cross-section and panel estimates may be useful in that they allow estimation of average interaction effects, which may allow one to calculate the costs of the spill over effects of increases in military expenditure in one country. Our second general conclusion is that globalization means that one cannot confine attention to a bivariate interaction between two countries without taking account of the wider strategic context. The emphasis in this literature is on quantitative-symmetric arms races, because those are easier to estimate, but this emphasis may be misleading, qualitative-asymmetric arms races, particularly between governments and their non-governmental opponents, may be much more important.

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
File URL: http://www.sciencedirect.com/science/article/B7RKP-4N6Y69H-C/2/caff88b2d7538657086db7056c6ee9d2
Download Restriction: Full text for ScienceDirect subscribers only

As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.

Bibliographic Info

as in new window

This chapter was published in:

  • Keith Hartley & Todd Sandler (ed.), 2007. "Handbook of Defense Economics," Handbook of Defense Economics, Elsevier, edition 1, volume 2, number 1, 00.
    This item is provided by Elsevier in its series Handbook of Defense Economics with number 2-28.

    Handle: RePEc:eee:hdechp:2-28

    Contact details of provider:
    Web page: http://www.elsevier.com/wps/find/bookseriesdescription.cws_home/BS_HE/description

    Related research

    Keywords: Defense in a Globalized World;

    Find related papers by JEL classification:

    References

    No references listed on IDEAS
    You can help add them by filling out this form.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as in new window

    Cited by:
    1. William D. Nordhaus & John R. Oneal & Bruce Russett, 2009. "The Effects of the Security Environment on Military Expenditures: Pooled Analyses of 165 Countries, 1950-2000," Cowles Foundation Discussion Papers 1707, Cowles Foundation for Research in Economics, Yale University, revised Oct 2009.
    2. J Paul Dunne & Sam Perlo-Freeman & Ron P Smith, 2009. "Determining Military Expenditures: Arms Races and Spill-Over Effects in Cross-Section and Panel Data," Working Papers 0901, Department of Accounting, Economics and Finance, Bristol Business School, University of the West of England, Bristol.
    3. J Paul Dunne & Ron P. Smith, 2010. "Military Expenditure and Granger Causality: A Critical Review," Working Papers 1007, Department of Accounting, Economics and Finance, Bristol Business School, University of the West of England, Bristol.
    4. J Paul Dunne & Samuel Perlo-Freeman & Ron P Smith, 2007. "The Demand for Military Expenditure in Developing Countries: Hostility versus Capability," Working Papers 0707, Department of Accounting, Economics and Finance, Bristol Business School, University of the West of England, Bristol.

    Lists

    This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

    Statistics

    Access and download statistics

    Corrections

    When requesting a correction, please mention this item's handle: RePEc:eee:hdechp:2-28. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Zhang, Lei).

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If references are entirely missing, you can add them using this form.

    If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.