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Estimating the Impact of the Soviet Union's Threat on the United States-Japan Alliance: A Demand System Approach

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  • Okamura, Minoru

Abstract

An empirical model of the United States-Japan alliance is presented by employing the linear logarithmic expenditure system. To analyze and test the impact of the Soviet Union's threat on both allies, external threats are incorporated into the demand system. The empirical results obtained the military buildup by the Soviet Union affects the preferences of both Japan and the United States toward military over civilian goods; Japan is more sensitive to the Soviet Union's threat than the United States; and the external threat is a more significant factor in affecting the military expenditures of each ally than a change in prices. Copyright 1991 by MIT Press.

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  • Okamura, Minoru, 1991. "Estimating the Impact of the Soviet Union's Threat on the United States-Japan Alliance: A Demand System Approach," The Review of Economics and Statistics, MIT Press, vol. 73(2), pages 200-207, May.
    • Handle: RePEc:tpr:restat:v:73:y:1991:i:2:p:200-207
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    Cited by:

    1. Keith Hartley & Todd Sandler, 2001. "Economics of Alliances: The Lessons for Collective Action," Journal of Economic Literature, American Economic Association, vol. 39(3), pages 869-896, September.
    2. Goo, Young-Wan & Lee, Seong-Hoon, 2014. "Military Alliances and Reality of Regional Integration: Japan, South Korea, the US vs. China, North Korea," Journal of Economic Integration, Center for Economic Integration, Sejong University, vol. 29, pages 329-342.
    3. Conybeare, John A C & Murdoch, James C & Sandler, Todd, 1994. "Alternative Collective-Goods Models of Military Alliances: Theory and Empirics," Economic Inquiry, Western Economic Association International, vol. 32(4), pages 525-542, October.
    4. Minoru Okamura, 2022. "Identifying the public goods allocation process: case of the North Atlantic Treaty Organization," Empirical Economics, Springer, vol. 63(3), pages 1707-1726, September.
    5. Todd Sandler, 1993. "The Economic Theory of Alliances," Journal of Conflict Resolution, Peace Science Society (International), vol. 37(3), pages 446-483, September.
    6. Young‐Wan Goo & Seung‐Nyeon Kim, 2012. "Time-Varying Characteristics Of South Korea-United States And Japan-United States Military Alliances Under Chinese Threat: A Public Good Approach," Defence and Peace Economics, Taylor & Francis Journals, vol. 23(1), pages 95-106, February.

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