The Impact of Worldwide Military Spending Cuts on Developing Countries
This paper investigates the economic impact of a coordinated reduction in military expenditures of 20 percent using a specially modified version of the MULTIMOD world economic model. Simulation results indicate that in developing countries the present value of consumption increases by 46 percent of 1992 GDP, compared to military expenditures cuts, in present value terms, of 33 percent of 1992 GDP. The gains reflect both the release of domestic resources and a positive international economic externality due to enhanced trade and lower world interest rates. Accordingly, the net debtor developing country gains exceed those of industrial countries. Examination of individual developing country economies confirms the significance of the external trade effect on the pattern and level of gains.
(This abstract was borrowed from another version of this item.)
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Ronnie Lowenstein & Richard Peach, 1992. "The impact of the current defense build-down," Quarterly Review, Federal Reserve Bank of New York, issue Aut, pages 59-68.
When requesting a correction, please mention this item's handle: RePEc:eee:jpolmo:v:20:y:1998:i:3:p:261-303. See general information about how to correct material in RePEc.
If references are entirely missing, you can add them using this form.