The Global Arms Trade Network 1950-2007

Using a large dataset covering all trade in military equipment over the period 1950-2007, we address the relationship between differences in polity and arms trade from a novel empirical perspective. We provide evidence on the determinants of link formation at the bilateral level by estimating gravity specifications and study the evolution of the arms trade network at the global level. Throughout the analysis, we exploit the exogenous shift in preferences implied by the collapse of the Soviet Union in 1991 to discriminate between different hypotheses about the underlying incentives for arms trade. We find a stable negative relationship between differences in polity and the likelihood of arms trade for the duration of the Cold War, but in recent years any negative effects of political differences on the likelihood of arms trade that we find can be entirely accounted for by exporter and importer fixed effects. Our findings thus suggest that democracies have not, on average, discriminated against autocracies when trading arms in the post-Cold War era. The results from the net-work analysis reveal that the network as a whole changes drastically over the sample period in several respects. In addition to comparing the network to other empirical networks, we are able to document important differences between the workings of the NATO and Warsaw Pact sub-networks prior to 1991.