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Reconsidering publicness in alliance defence expenditures: NATO expansion and burden sharing

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  • William Gates
  • Katsuaki Terasawa

Abstract

Over the past several decades, NATO allies have debated the relative burdens and benefits of NATO membership. Recently, this concern surfaced as members debated the magnitude and distribution of NATO expansion costs. This paper presents an economic model of defence alliances to identify the benefits and burdens of alliance membership. It suggests that defence expenditures provide public benefits if alliance members share common interests and mutual commitment; defence expenditures provide private benefits if countries lack common interests and mutual commitment. The model's results are used to discuss NATO's evolving roles and missions, NATO expansion and burden sharing across NATO members.

Suggested Citation

  • William Gates & Katsuaki Terasawa, 2003. "Reconsidering publicness in alliance defence expenditures: NATO expansion and burden sharing," Defence and Peace Economics, Taylor & Francis Journals, vol. 14(5), pages 369-383.
  • Handle: RePEc:taf:defpea:v:14:y:2003:i:5:p:369-383
    DOI: 10.1080/10242690302924
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    References listed on IDEAS

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    1. Sandler,Todd & Hartley,Keith, 1999. "The Political Economy of NATO," Cambridge Books, Cambridge University Press, number 9780521630931, April.
    2. Oneal, John R., 1990. "The theory of collective action and burden sharing in NATO," International Organization, Cambridge University Press, vol. 44(03), pages 379-402, June.
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    7. Loehr, William, 1973. "Collective Goods and International Cooperation: Comments," International Organization, Cambridge University Press, vol. 27(03), pages 421-430, June.
    8. Martin C. McGuire & Carl H. Groth, 1985. "A Method for Identifying the Public Good Allocation Process Within a Group," The Quarterly Journal of Economics, Oxford University Press, vol. 100(Supplemen), pages 915-934.
    9. Sandler, Todd, 1977. "Impurity of Defense: An Application to the Economics of Alliances," Kyklos, Wiley Blackwell, vol. 30(3), pages 443-460.
    10. Todd Sandler & James C. Murdoch, 1990. "Nash-Cournot or Lindahl Behavior?: An Empirical Test for the NATO Allies," The Quarterly Journal of Economics, Oxford University Press, vol. 105(4), pages 875-894.
    11. Irving B. Kravis & Michael W. S. Davenport, 1963. "The Political Arithmetic of International Burden-Sharing," Journal of Political Economy, University of Chicago Press, vol. 71, pages 309-309.
    12. Sandler,Todd & Hartley,Keith, 1995. "The Economics of Defense," Cambridge Books, Cambridge University Press, number 9780521447287, April.
    13. Weber, S. & Wiesmeth, H., 1990. "Economic Models of NATO," Papers 90-7, York (Canada) - Department of Economics.
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    Cited by:

    1. Renaud Bellais & Martial Foucault & Jean-Michel Oudot, 2014. "Économie de la défense," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) hal-01052607, HAL.
    2. Jomana Amara, 2008. "Nato Defense Expenditures: Common Goals Or Diverging Interests? A Structural Analysis," Defence and Peace Economics, Taylor & Francis Journals, vol. 19(6), pages 449-469.

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