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U.S. War Costs: Two Parts Temporary, One Part Permanent

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  • Ryan D. Edwards

Abstract

Military spending, fatalities, and the destruction of capital, all of which are immediately felt and are often large, are the most overt costs of war. They are also relatively short-lived. The costs of war borne by combatants and their caretakers, which includes families, communities, and the modern welfare state, tend instead to be lifelong. In this paper I show that a significant component of the public costs associated with U.S. wars are long-lived. One third to one half of the total present value of historical war costs have been absorbed by benefits distributed over the remaining life spans of veterans and their dependents. The half-life of these benefits has averaged more than 30 years following the end of hostilities. Estimates of the value of injuries and deaths, while uncertain, suggest that the private burden of war borne by survivors, namely the uncompensated costs of service-related injuries, are also large and long-lived.

Suggested Citation

  • Ryan D. Edwards, 2010. "U.S. War Costs: Two Parts Temporary, One Part Permanent," NBER Working Papers 16108, National Bureau of Economic Research, Inc.
  • Handle: RePEc:nbr:nberwo:16108 Note: DAE EFG PE
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    Cited by:

    1. Lee, Chulhee, 2014. "In utero exposure to the Korean War and its long-term effects on socioeconomic and health outcomes," Journal of Health Economics, Elsevier, vol. 33(C), pages 76-93.
    2. Gregg, Matthew T. & Wishart, David M., 2012. "The price of Cherokee removal," Explorations in Economic History, Elsevier, vol. 49(4), pages 423-442.
    3. Ryan D. Edwards, 2010. "A Review of War Costs in Iraq and Afghanistan," NBER Working Papers 16163, National Bureau of Economic Research, Inc.

    More about this item

    JEL classification:

    • H56 - Public Economics - - National Government Expenditures and Related Policies - - - National Security and War
    • H68 - Public Economics - - National Budget, Deficit, and Debt - - - Forecasts of Budgets, Deficits, and Debt
    • J17 - Labor and Demographic Economics - - Demographic Economics - - - Value of Life; Foregone Income
    • N41 - Economic History - - Government, War, Law, International Relations, and Regulation - - - U.S.; Canada: Pre-1913
    • N42 - Economic History - - Government, War, Law, International Relations, and Regulation - - - U.S.; Canada: 1913-

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