IDEAS home Printed from https://ideas.repec.org/a/spr/empeco/v66y2024i3d10.1007_s00181-023-02486-8.html
   My bibliography  Save this article

Divergence and club convergence in NATO

Author

Listed:
  • Yasin Kutuk

    (Altınbaş University)

Abstract

This study examines whether there is convergence in military expenditures among NATO countries by using Philips and Sul (Econometrica 75:1771–1855, 2007) convergence methodology. We obtained the primary dataset of 27 NATO member countries between 2009 and 2021 for their military expenditures to accomplish this. The results show no convergence between the military expenditures of NATO member states. In addition, although these 27 member countries are divergent, the analysis also identified three convergent clubs among NATO members with exciting patterns and trends in their military expenditures.

Suggested Citation

  • Yasin Kutuk, 2024. "Divergence and club convergence in NATO," Empirical Economics, Springer, vol. 66(3), pages 1013-1035, March.
    • Handle: RePEc:spr:empeco:v:66:y:2024:i:3:d:10.1007_s00181-023-02486-8
    DOI: 10.1007/s00181-023-02486-8
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s00181-023-02486-8
    File Function: Abstract
    Download Restriction: Access to the full text of the articles in this series is restricted.
    File URL: https://libkey.io/10.1007/s00181-023-02486-8?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Jon CW Pevehouse & Timothy Nordstrom & Roseanne W McManus & Anne Spencer Jamison, 2020. "Tracking organizations in the world: The Correlates of War IGO Version 3.0 datasets," Journal of Peace Research, Peace Research Institute Oslo, vol. 57(3), pages 492-503, May.
    2. Robert M. Solow, 1956. "A Contribution to the Theory of Economic Growth," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 70(1), pages 65-94.
    3. Kutuk, Yasin, 2022. "Inequality convergence: A world-systems theory approach," Structural Change and Economic Dynamics, Elsevier, vol. 63(C), pages 150-165.
    4. Arvanitidis Paschalis & Kollias Christos & Anastasopoulos Konstantinos, 2014. "Is There an International Convergence in Defence Burdens? Some Initial Findings," Peace Economics, Peace Science, and Public Policy, De Gruyter, vol. 20(4), pages 611-620, December.
    5. Newey, Whitney K & West, Kenneth D, 1987. "Hypothesis Testing with Efficient Method of Moments Estimation," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 28(3), pages 777-787, October.
    6. Bernard, Andrew B & Durlauf, Steven N, 1995. "Convergence in International Output," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 10(2), pages 97-108, April-Jun.
    7. Keith Hartley & Todd Sandler, 1999. "NATO Burden-Sharing: Past and Future," Journal of Peace Research, Peace Research Institute Oslo, vol. 36(6), pages 665-680, November.
    8. T. W. Swan, 1956. "ECONOMIC GROWTH and CAPITAL ACCUMULATION," The Economic Record, The Economic Society of Australia, vol. 32(2), pages 334-361, November.
    9. Alptekin, Aynur & Levine, Paul, 2012. "Military expenditure and economic growth: A meta-analysis," European Journal of Political Economy, Elsevier, vol. 28(4), pages 636-650.
    10. Eric S. Lin & Hamid E. Ali, 2009. "Military Spending and Inequality: Panel Granger Causality Test," Journal of Peace Research, Peace Research Institute Oslo, vol. 46(5), pages 671-685, September.
    11. Justin George & Todd Sandler, 2022. "NATO defense demand, free riding, and the Russo-Ukrainian war in 2022," Economia e Politica Industriale: Journal of Industrial and Business Economics, Springer;Associazione Amici di Economia e Politica Industriale, vol. 49(4), pages 783-806, December.
    12. Mr. Benedict J. Clements & Mr. Sanjeev Gupta & Saida Khamidova, 2019. "Is Military Spending Converging Across Countries? An Examination of Trends and Key Determinants," IMF Working Papers 2019/196, International Monetary Fund.
    13. Luca Pieroni, 2009. "Military Expenditure And Economic Growth," Defence and Peace Economics, Taylor & Francis Journals, vol. 20(4), pages 327-339.
    14. Ramesh Chandra Das & Soumyananda Dinda & Frank Martin, 2018. "Defence Outlays Across Countries: Are They Converging?," South Asian Journal of Macroeconomics and Public Finance, , vol. 7(1), pages 109-129, June.
    15. Chi Keung Marco Lau & Ender Demir & Mehmet Huseyin Bilgin, 2016. "A Nonlinear Model of Military Expenditure Convergence: Evidence From Estar Nonlinear Unit Root Test," Defence and Peace Economics, Taylor & Francis Journals, vol. 27(3), pages 392-403, June.
    16. Benoit, Emile, 1978. "Growth and Defense in Developing Countries," Economic Development and Cultural Change, University of Chicago Press, vol. 26(2), pages 271-280, January.
    17. J. Paul Dunne & Nan Tian, 2015. "Military Expenditure, Economic Growth and Heterogeneity," Defence and Peace Economics, Taylor & Francis Journals, vol. 26(1), pages 15-31, February.
    18. Quah, Danny T., 1996. "Empirics for economic growth and convergence," European Economic Review, Elsevier, vol. 40(6), pages 1353-1375, June.
    19. N. Gregory Mankiw & David Romer & David N. Weil, 1992. "A Contribution to the Empirics of Economic Growth," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 107(2), pages 407-437.
    20. Peter C. B. Phillips & Donggyu Sul, 2007. "Transition Modeling and Econometric Convergence Tests," Econometrica, Econometric Society, vol. 75(6), pages 1771-1855, November.
    21. J. Paul Dunne & Ron Smith & Dirk Willenbockel, 2005. "Models Of Military Expenditure And Growth: A Critical Review," Defence and Peace Economics, Taylor & Francis Journals, vol. 16(6), pages 449-461.
    22. Darrell Driver, 2016. "Burden sharing and the future of NATO: wandering between two worlds," Defense & Security Analysis, Taylor & Francis Journals, vol. 32(1), pages 4-18, March.
    23. Ucler, Gulbahar & Bulut, Umit, 2021. "Re-examination of the Convergence in Military Expenditures across NATO Countries: Do Different Approximations in Modelling Structural Breaks Matter?," Asian Journal of Applied Economics, Kasetsart University, Center for Applied Economics Research, vol. 28(01).
    24. Quah, Danny, 1993. "Empirical cross-section dynamics in economic growth," European Economic Review, Elsevier, vol. 37(2-3), pages 426-434, April.
    25. Quah, Danny, 1997. "Empirics for Growth and Distribution: Stratification, Polarization, and Convergence Clubs," CEPR Discussion Papers 1586, C.E.P.R. Discussion Papers.
    26. Arvanitidis Paschalis & Kollias Christos, 2016. "Converging Defence Burdens? Some Further Findings," Peace Economics, Peace Science, and Public Policy, De Gruyter, vol. 22(4), pages 365-375, December.
    27. Paul M. Romer, 1987. "Crazy Explanations for the Productivity Slowdown," NBER Chapters, in: NBER Macroeconomics Annual 1987, Volume 2, pages 163-210, National Bureau of Economic Research, Inc.
    28. Bansi Sawhney & Emmanuel Anoruo & William R. DiPietro, 2016. "The world distribution of military spending: is there a convergence?," International Journal of Computational Economics and Econometrics, Inderscience Enterprises Ltd, vol. 6(4), pages 351-365.
    29. Selahattin GÜRİŞ & Burak GÜRİŞ & Muhammed TIRAŞOĞLU, 2017. "Do military expenditures converge in NATO countries? Linear and nonlinear unit root test evidence," Theoretical and Applied Economics, Asociatia Generala a Economistilor din Romania / Editura Economica, vol. 0(2(611), S), pages 237-248, Summer.
    30. Daniel Fiott, 2022. "The Fog of War: Russia’s War on Ukraine, European Defence Spending and Military Capabilities," Intereconomics: Review of European Economic Policy, Springer;ZBW - Leibniz Information Centre for Economics;Centre for European Policy Studies (CEPS), vol. 57(3), pages 152-156, May.
    31. Nazrul Islam, 1995. "Growth Empirics: A Panel Data Approach," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 110(4), pages 1127-1170.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Charles Shaaba Saba & Nicholas Ngepah & Christian Nsiah, 2020. "Convergence in military expenditure and economic growth in Africa and its regional economic communities: evidence from a club clustering algorithm," Cogent Economics & Finance, Taylor & Francis Journals, vol. 8(1), pages 1832344-183, January.
    2. Saba Charles Shaaba & Ngepah Nicholas, 2020. "Military expenditure and security outcome convergence in African regional economic communities: evidence from the convergence club algorithm," Peace Economics, Peace Science, and Public Policy, De Gruyter, vol. 26(1), pages 1-28, February.
    3. Durlauf, Steven N. & Quah, Danny T., 1999. "The new empirics of economic growth," Handbook of Macroeconomics, in: J. B. Taylor & M. Woodford (ed.), Handbook of Macroeconomics, edition 1, volume 1, chapter 4, pages 235-308, Elsevier.
    4. Sedat Alataş & Erkam Sarı, 2021. "An Empirical Investigation on Regional Disparities in Public Expenditures: Province Level Evidence from Turkey," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 158(1), pages 217-240, November.
    5. Nicholas Apergis & Christina Christou & Stephen Miller, 2012. "Convergence patterns in financial development: evidence from club convergence," Empirical Economics, Springer, vol. 43(3), pages 1011-1040, December.
    6. Cem Ertur & Julie Le Gallo & Catherine Baumont, 2006. "The European Regional Convergence Process, 1980-1995: Do Spatial Regimes and Spatial Dependence Matter?," International Regional Science Review, , vol. 29(1), pages 3-34, January.
    7. Saba Charles Shaaba, 2021. "Convergence or Divergence Patterns in Global Defence Spending: Further Evidence from a Nonlinear Single Factor Model," Peace Economics, Peace Science, and Public Policy, De Gruyter, vol. 27(1), pages 51-90, February.
    8. Sakari Lähdemäki, 2024. "Cross-country convergence: to be or not to be, that is the question," Empirical Economics, Springer, vol. 67(2), pages 839-875, August.
    9. Magrini, Stefano, 2004. "Regional (di)convergence," Handbook of Regional and Urban Economics, in: J. V. Henderson & J. F. Thisse (ed.), Handbook of Regional and Urban Economics, edition 1, volume 4, chapter 62, pages 2741-2796, Elsevier.
    10. Hanson Robert & Jeon Joo Young, 2024. "The Military Expenditure – Economic Growth Nexus Revisited: Evidence from the United Kingdom," Peace Economics, Peace Science, and Public Policy, De Gruyter, vol. 30(2), pages 207-248.
    11. Nicholas Apergis & Christina Christou & Rangan Gupta & Stephen M. Miller, 2018. "Convergence in Income Inequality: Further Evidence from the Club Clustering Methodology across States in the U.S," International Advances in Economic Research, Springer;International Atlantic Economic Society, vol. 24(2), pages 147-161, May.
    12. Ucler, Gulbahar & Bulut, Umit, 2021. "Re-examination of the Convergence in Military Expenditures across NATO Countries: Do Different Approximations in Modeling Structural Breaks Matter?," Asian Journal of Applied Economics/ Applied Economics Journal, Kasetsart University, Faculty of Economics, Center for Applied Economic Research, vol. 28(1), pages 43-62, June.
    13. Kutuk, Yasin, 2022. "Inequality convergence: A world-systems theory approach," Structural Change and Economic Dynamics, Elsevier, vol. 63(C), pages 150-165.
    14. Matthew Higgins & Daniel Levy & Andrew T. Young, 2003. "Growth and Convergence across the US: Evidence from County-Level Data," Working Papers 2003-03, Bar-Ilan University, Department of Economics.
    15. Sulekha Hembram & Souparna Maji & Sushil Kr. Haldar, 2019. "Club Convergence among the Major Indian States During 1982–2014: Does Investment in Human Capital Matter?," South Asia Economic Journal, Institute of Policy Studies of Sri Lanka, vol. 20(2), pages 184-204, September.
    16. Sulekha Hembram & Sushil Kr. Haldar, 2019. "Beta, sigma and club convergence: Indian experience from 1980 to 2015," Indian Economic Review, Springer, vol. 54(2), pages 343-366, December.
    17. Uzma Zia, 2019. "An Evidence of Diverging SAARC Economies," PIDE-Working Papers 2019:170, Pakistan Institute of Development Economics.
    18. Charles Shaaba Saba & Oladipo Olalekan David, 2023. "Identifying Convergence in Telecommunication Infrastructures and the Dynamics of Their Influencing Factors Across Countries," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 14(2), pages 1413-1466, June.
    19. Haupt, Harry & Schnurbus, Joachim & Semmler, Willi, 2018. "Estimation of grouped, time-varying convergence in economic growth," Econometrics and Statistics, Elsevier, vol. 8(C), pages 141-158.
    20. Cristina D. Checherita, 2009. "Variations on economic convergence: The case of the United States," Papers in Regional Science, Wiley Blackwell, vol. 88(2), pages 259-278, June.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:spr:empeco:v:66:y:2024:i:3:d:10.1007_s00181-023-02486-8. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.