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The Global Arms Trade Network 1950-2007

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Abstract

We study the evolution of the global arms trade network using a unique dataset on all international transfers of major conventional weapons over the period 1950-2007. First, we provide a careful description of the characteristics of global arms trade using tools from social network analysis. Second, we relate our …findings to political regimes by studying whether differences in polity scores affect the likelihood of arms trade by estimating an augmented gravity equation. Our findings from the network analysis are much in line with common views of the Cold War. We see a clear division between the Warsaw Pact and NATO, with the Soviet Union being more central to the former than the United States to the latter. We find that differences in polity has a significant, negative effect on the likelihood of arms trade between two countries. The relationship is remarkably robust throughout the sample period and does not hold for trade in any other good that we investigate. The result suggests that democracies are indeed more likely to trade arms with other democracies than with autocracies since the former are not perceived as potential adversaries. We view this finding as evidence in favour of the Democratic Peace Theory.

Suggested Citation

  • Akerman, Anders & Larsson, Anna, 2010. "The Global Arms Trade Network 1950-2007," Research Papers in Economics 2010:2, Stockholm University, Department of Economics.
  • Handle: RePEc:hhs:sunrpe:2010_0002
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    As found by EconAcademics.org, the blog aggregator for Economics research:
    1. This is what the global arms trade looks like
      by Ariel Goldring in Free Market Mojo on 2010-02-23 19:28:23

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    Cited by:

    1. João Amador & Sónia Cabral, 2017. "Networks of Value-added Trade," The World Economy, Wiley Blackwell, vol. 40(7), pages 1291-1313, July.
    2. Florian Johannsen & Inmaculada Martínez-Zarzoso, "undated". "Political Determinants of the Extensive and Intensive Margins of International Arms Transfers," Ibero America Institute for Econ. Research (IAI) Discussion Papers 228, Ibero-America Institute for Economic Research.
    3. De Benedictis Luca & Nenci Silvia & Santoni Gianluca & Tajoli Lucia & Vicarelli Claudio, 2014. "Network Analysis of World Trade using the BACI-CEPII Dataset," Global Economy Journal, De Gruyter, vol. 14(3-4), pages 1-57, October.
    4. Apergis, Emmanuel & Apergis, Nicholas, 2016. "The 11/13 Paris terrorist attacks and stock prices: The case of the international defense industry," Finance Research Letters, Elsevier, vol. 17(C), pages 186-192.
    5. Zenou, Yves & König, Michael D. & Tessone, Claudio J., 2014. "Nestedness in networks: A theoretical model and some applications," Theoretical Economics, Econometric Society, vol. 9(3), September.
    6. repec:oup:erevae:v:44:y:2017:i:4:p:592-633. is not listed on IDEAS
    7. Einar Engvig, 2014. "The T - Rex in the Room: Using Network Analysis to Get a Better Grasp of Small Arms Issues," SADO - Working Papers 208, Small Arms Data Observatory.
    8. Vincenzo Bove & Claudio Deiana & Roberto Nisticò, 2016. "Global Arms Trade and Oil Dependence," CSEF Working Papers 452, Centre for Studies in Economics and Finance (CSEF), University of Naples, Italy, revised 10 Feb 2018.
    9. Nicholas Apergis & Matteo Bonato & Rangan Gupta & Clement Kyei, 2016. "Does Geopolitical Risks Predict Stock Returns and Volatility of Leading Defense Companies? Evidence from a Nonparametric Approach," Working Papers 201671, University of Pretoria, Department of Economics.
    10. Marco Pelliccia, 2015. "Bargaining in Global Communication Networks," Birkbeck Working Papers in Economics and Finance 1507, Birkbeck, Department of Economics, Mathematics & Statistics.

    More about this item

    Keywords

    Arms Trade; Networks; Democracy; Autocracy; NATO; The Warsaw Pact;

    JEL classification:

    • F19 - International Economics - - Trade - - - Other
    • F51 - International Economics - - International Relations, National Security, and International Political Economy - - - International Conflicts; Negotiations; Sanctions
    • F59 - International Economics - - International Relations, National Security, and International Political Economy - - - Other
    • P51 - Economic Systems - - Comparative Economic Systems - - - Comparative Analysis of Economic Systems

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