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Military Expenditure, Government Size and Economic Growth in the Middle East in the Period 1973-85

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  • Mikael Lindén

    (Department of Economics, University of Helsinki)

Abstract

An augmented two-sector growth model is derived to analyse the effects of the military burden and government expenditure on the growth of GNP in selected Middle Eastern countries. The empirical results reveal that the military burden and related activities had a negative effect on the growth of GNP in the period 1974-85. The size of the government sector, oil prices and capital formation, in turn, had positive effects on economic growth. The difference in marginal productivity in different sectors is relatively small and the positive externality effect of the government on private consumption is fairly large. Country-specific factors had a minor effect on the result.

Suggested Citation

  • Mikael Lindén, 1992. "Military Expenditure, Government Size and Economic Growth in the Middle East in the Period 1973-85," Journal of Peace Research, Peace Research Institute Oslo, vol. 29(3), pages 265-270, August.
    • Handle: RePEc:sae:joupea:v:29:y:1992:i:3:p:265-270
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    Cited by:

    1. Paresh Kumar Narayan & Russell Smyth, 2007. "The Military Expenditure-External Debt Nexus: New Evidence From A Panel Of Middle Eastern Countries," Monash Economics Working Papers 17-07, Monash University, Department of Economics.

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