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Defense Spending Promotes Aggregate Output in the United States--Evidence from Cointegration Analysis*

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Author

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  • H. Sonmez Atesoglu

Abstract

This paper provides new evidence on the question of the effects of defense spending on aggregate output in the United States. Earlier studies of this basic issue relied on traditional econometric techniques and the neoclassical production function theory. In this paper, recently developed cointegration methodology and modeling that is inspired by new macroeconomic theory is employed. The results from earlier studies concerning the effects of defense spending are mixed. The findings presented in this paper reveal that there is a quantitatively important and positive relation between defense spending and aggregate output in the United States.

Suggested Citation

  • H. Sonmez Atesoglu, 2002. "Defense Spending Promotes Aggregate Output in the United States--Evidence from Cointegration Analysis," Defence and Peace Economics, Taylor & Francis Journals, vol. 13(1), pages 55-60.
    • Handle: RePEc:taf:defpea:v:13:y:2002:i:1:p:55-60
    DOI: 10.1080/10242690210963
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    References listed on IDEAS

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    Replication

    This item has been replicated by:
  • Jurgen Brauer, 2007. "Data, Models, Coefficients: The Case of United States Military Expenditure," Conflict Management and Peace Science, Peace Science Society (International), vol. 24(1), pages 55-64, February.

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