The Effect of Military Expenditure on Growth: An Empirical Synthesis

Using a sample of 243 meta-observations drawn from 42 primary studies, this paper conducts a metaanalysis of the empirical literature that examines the impact of military expenditure on economic growth. We find that existing studies indicate growth-retarding effects of military expenditure. The results from the meta-regression analysis suggest that the effect size estimate is strongly influenced by study variations. Specifically, we find that underlying theoretical models, econometric specifications, and data type as well as data period are relevant factors that explain the heterogeneity in the military expenditure-growth literature. Results also show that positive effects of military expenditure on growth are more pronounced for developed countries than less developed countries.