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Coups d’état and defense spending: a counterfactual analysis

Listed author(s):
  • Vincenzo Bove

    ()

  • Roberto Nisticò

We explore how institutional set-ups, in particular changes in political institutions through coups d’état, can affect the way military expenditures are determined. We use a counterfactual approach, the synthetic control method, and compare the evolution of the military burden for 40 countries affected by coups with the evolution of a synthetic counterfactual that replicates the initial conditions and the potential outcomes of the countries of interest before exposure to coups. Our case studies suggest that successful coups result in a large increase in the military burden. However, when no effects or a decrease in the defense burden are found, it is often the consequence of a democratization process triggered by the coup. These results are in keeping with recent theoretical developments on the bargaining power of the military in authoritarian regimes. Failed coups, by contrast, produce a smaller, and mostly positive, effect on the military burden, possibly as a result of the incumbent’s strategy to avert further challenges to the stability of the regime by buying off the military. Copyright Springer Science+Business Media New York 2014

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File URL: http://hdl.handle.net/10.1007/s11127-014-0202-2
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Article provided by Springer in its journal Public Choice.

Volume (Year): 161 (2014)
Issue (Month): 3 (December)
Pages: 321-344

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Handle: RePEc:kap:pubcho:v:161:y:2014:i:3:p:321-344
DOI: 10.1007/s11127-014-0202-2
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Order Information: Web: http://www.springer.com/economics/public+finance/journal/11127/PS2

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