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The Global Arms Trade Network 1950-2007

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Author Info

  • Akerman, Anders

    () (Dept. of Economics, Stockholm University)

  • Larsson, Anna

    () (Dept. of Economics, Stockholm University)

Abstract

We study the evolution of the global arms trade network using a unique dataset on all international transfers of major conventional weapons over the period 1950-2007. First, we provide a careful description of the characteristics of global arms trade using tools from social network analysis. Second, we relate our …findings to political regimes by studying whether differences in polity scores affect the likelihood of arms trade by estimating an augmented gravity equation. Our findings from the network analysis are much in line with common views of the Cold War. We see a clear division between the Warsaw Pact and NATO, with the Soviet Union being more central to the former than the United States to the latter. We find that differences in polity has a significant, negative effect on the likelihood of arms trade between two countries. The relationship is remarkably robust throughout the sample period and does not hold for trade in any other good that we investigate. The result suggests that democracies are indeed more likely to trade arms with other democracies than with autocracies since the former are not perceived as potential adversaries. We view this finding as evidence in favour of the Democratic Peace Theory.

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Bibliographic Info

Paper provided by Stockholm University, Department of Economics in its series Research Papers in Economics with number 2010:2.

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Length: 40 pages
Date of creation: 02 Feb 2010
Date of revision:
Handle: RePEc:hhs:sunrpe:2010_0002

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Postal: Department of Economics, Stockholm, S-106 91 Stockholm, Sweden
Phone: +46 8 16 20 00
Fax: +46 8 16 14 25
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Web page: http://www.ne.su.se/
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Keywords: Arms Trade; Networks; Democracy; Autocracy; NATO; The Warsaw Pact;

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References

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  1. Sandeep Baliga & Tomas Sjostrom, 2003. "Arms Races and Negotiations," Levine's Working Paper Archive 618897000000000766, David K. Levine.
  2. Sanjeev Goyal & Marco van der Leij & José Luis Moraga Gonzales, 2004. "Economics: An Emerging Small World?," CESifo Working Paper Series 1287, CESifo Group Munich.
  3. Levy, Gilat & Razin, Ronny, 2003. "It Takes Two: An Explanation of the Democratic Peace," CEPR Discussion Papers 3947, C.E.P.R. Discussion Papers.
  4. Flandreau, Marc & Jobst, Clemens, 2005. "The Ties that Divide: A Network Analysis of the International Monetary System, 1890 1910," The Journal of Economic History, Cambridge University Press, vol. 65(04), pages 977-1007, December.
  5. Luca De Benedictis & Lucia Tajoli, 2009. "The World Trade Network," Working Papers 51-2009, Macerata University, Department of Finance and Economic Sciences, revised Mar 2009.
  6. Melitz, Marc J, 2002. "The Impact of Trade on Intra-Industry Reallocations and Aggregate Industry Productivity," CEPR Discussion Papers 3381, C.E.P.R. Discussion Papers.
  7. Casey B. Mulligan & Xavier Sala-i-Martin & Ricard Gil, 2003. "Do Democracies Have Different Public Policies than Nondemocracies?," NBER Working Papers 10040, National Bureau of Economic Research, Inc.
  8. Levine, Paul & Smith, Ron, 1995. "The Arms Trade and Arms Control," Economic Journal, Royal Economic Society, vol. 105(429), pages 471-84, March.
  9. Intriligator, Michael D, 1975. "Strategic Considerations in the Richardson Model of Arms Races," Journal of Political Economy, University of Chicago Press, vol. 83(2), pages 339-53, April.
  10. Marc Flandreau & Clemens Jobst, 2009. "The Empirics of International Currencies: Network Externalities, History and Persistence," Economic Journal, Royal Economic Society, vol. 119(537), pages 643-664, 04.
  11. Cowen, Tyler, 1990. " Economic Effects of a Conflict-Prone World Order," Public Choice, Springer, vol. 64(2), pages 121-34, February.
  12. Elhanan Helpman & Marc Melitz & Yona Rubinstein, 2007. "Estimating Trade Flows: Trading Partners and Trading Volumes," NBER Working Papers 12927, National Bureau of Economic Research, Inc.
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Blog mentions

As found by EconAcademics.org, the blog aggregator for Economics research:
  1. This is what the global arms trade looks like
    by Ariel Goldring in Free Market Mojo on 2010-02-23 13:28:23
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Cited by:
  1. Michael Koenig & Claudio Tessone & Yves Zenou, 2012. "Nestedness in Networks: A Theoretical Model and Some Applications," Discussion Papers 11-003, Stanford Institute for Economic Policy Research.

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