Revisiting the guns vs butter dilemma. Was Spain different in the implementation of public policies? Defence, growth and education

Over the past few decades, numerous studies have been conducted on the trade-off between guns and butter, namely defence spending versus social sector expenditure. It is striking that none has examined the situation in Spain. Previous research on other countries has not provided strong and unambiguous evidence of either positive or negative effects for military expenditure on social spending. We test whether government expenditure on defence contributed positively or negatively to education spending in twentieth-century Spain, attempting to identify policy-making processes within a historical framework. The results show both direct and indirect effects and bring to light the negative consequences of military spending on education expenditure, in particular between the second and fifth year after the military expenditure increases.