Defence Spending and Economic Growth in the EU15
AbstractOver the last 30 years there has been an impressive amount of empirical work on the defence-growth nexus, using different methodologies, models and econometric techniques and focusing on individual case studies, cross-country studies or panel data studies. Despite the number and the variety of studies, the evidence on the defence-growth relationship is still far from conclusive. Rather surprisingly, very limited work has been published in the relevant literature for the European Union despite the continuous discussions for a Common European Defence Policy that would require an assessment of the economic effects of defence in this region. To fill in the gap in the literature, this paper employs an augmented Solow-Swan model and estimates it both with panel and time series methods to provide empirical evidence on the economic effects of defence spending in the EU15 over the period 1961-2007. Overall, evidence derived from both panel and time series methods is consistent and suggests that military burden does not promote economic growth in this region.
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Bibliographic InfoPaper provided by Department of Accounting, Economics and Finance, Bristol Business School, University of the West of England, Bristol in its series Working Papers with number 1102.
Length: 16 pages
Date of creation: Mar 2011
Date of revision:
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Web page: http://www1.uwe.ac.uk/bl/research/bristoleconomics.aspx
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Defence Spending; Economic Growth; Panel data; time series; EU15;
Other versions of this item:
- H56 - Public Economics - - National Government Expenditures and Related Policies - - - National Security and War
- O40 - Economic Development, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General
This paper has been announced in the following NEP Reports:
- NEP-ALL-2011-03-19 (All new papers)
- NEP-EEC-2011-03-19 (European Economics)
- NEP-FDG-2011-03-19 (Financial Development & Growth)
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- Vincenzo Bove & Georgios Efthyvoulou, 2013.
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- Paul Dunne & Eftychia Nikolaidou, 2005. "Military Spending and Economic Growth in Greece, Portugal and Spain," Working Papers 0510, Department of Accounting, Economics and Finance, Bristol Business School, University of the West of England, Bristol.
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