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Officer retention and military spending: the rise of the military‐industrial complex during the Second World War

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  • AHMED S. RAHMAN

Abstract

This article examines how the regional distribution of US military personnel contributed to military expenditures around the country. We first discuss a theory of political economy for military spending—officers who remain in service can eventually help channel military funds and employment to their respective regions of origin, through direct military spending decisions or indirect political channels. Further, if officer retention is positively related to less industrialization at home (fewer work opportunities at home induce greater service lengths), this channel will induce greater progressiveness in military spending. To test these ideas we use the personnel records of officers serving in the US Navy from 1870 to the late 1930s. Tracking the tenure of all officers, we construct measures of ‘military representation’ across US counties. Through ordinary least squares, Tobit, and instrumental variable approaches, we find that senior naval officer representation across regions positively and robustly predicts regional naval spending (but not spending from other branches) during the Second World War.

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  • Ahmed S. Rahman, 2020. "Officer retention and military spending: the rise of the military‐industrial complex during the Second World War," Economic History Review, Economic History Society, vol. 73(4), pages 1074-1096, November.
    • Handle: RePEc:bla:ehsrev:v:73:y:2020:i:4:p:1074-1096
    DOI: 10.1111/ehr.12940
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    2. Brunet, Gillian & Hilt, Eric & Jaremski, Matthew, 2025. "War bonds and household saving in WWII," Explorations in Economic History, Elsevier, vol. 97(C).

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