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U.S. Assistance, Israeli Allocation, and the Arms Race in the Middle East

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  • Martin C. McGuire

    (Department of Economics, University of Maryland)

Abstract

This paper constructs an econometric model of Israel's allocation of resources as between defense, public nondefense, and private consumption goods. Because these allocations are influenced by and simultaneously influence U.S. assistance and Arab military outlays, equations for U.S. and Arab allocations are also constructed. This entire multiequation system represents a multicountry allocation and arms race process in the Middle East. A comprehensive body of data on Israeli expenditures, surrounding Arab states expenditures, and U.S. assistance has been assembled for the period 1960 to 1979, and the multiequation model has been estimated. Several conclusions of both theoretical and policy importance emerge from the analysis.

Suggested Citation

  • Martin C. McGuire, 1982. "U.S. Assistance, Israeli Allocation, and the Arms Race in the Middle East," Journal of Conflict Resolution, Peace Science Society (International), vol. 26(2), pages 199-235, June.
  • Handle: RePEc:sae:jocore:v:26:y:1982:i:2:p:199-235
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    Cited by:

    1. Abu-Qarn Aamer S & Abu-Bader Suleiman, 2008. "Structural Breaks in Military Expenditures: Evidence for Egypt, Israel, Jordan and Syria," Peace Economics, Peace Science, and Public Policy, De Gruyter, vol. 14(1), pages 1-25, April.
    2. Goo, Young-Wan & Lee, Seong-Hoon, 2014. "Military Alliances and Reality of Regional Integration: Japan, South Korea, the US vs. China, North Korea," Journal of Economic Integration, Center for Economic Integration, Sejong University, vol. 29, pages 329-342.
    3. Sarah Langlotz & Niklas Potrafke, 2016. "Does Development Aid Increase Military Expenditure?," CESifo Working Paper Series 6088, CESifo Group Munich.
    4. Abu-Qarn, Aamer S. & Abu-Bader, Suleiman, 2009. "On the dynamics of the Israeli-Arab arms race," The Quarterly Review of Economics and Finance, Elsevier, vol. 49(3), pages 931-943, August.
    5. Aamer S. Abu-Qarn, 2008. "Six decades of the Israeli-Arab conflict: An assessment of the economic aspects," Economics of Peace and Security Journal, EPS Publishing, vol. 3(2), pages 8-15, July.
    6. Young‐Wan Goo & Seung‐Nyeon Kim, 2012. "Time-Varying Characteristics Of South Korea-United States And Japan-United States Military Alliances Under Chinese Threat: A Public Good Approach," Defence and Peace Economics, Taylor & Francis Journals, vol. 23(1), pages 95-106, February.

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