Military Expenditures and Economic Growth

By Jasen Castillo; Julia Lowell et al. | Go to book overview

Chapter Two
A BRIEF REVIEW OF THE STATISTICAL LITERATURE

The major strand of the literature on the statistical relationship between military spending and economic growth comes from the field of development economics, where a host of studies have attempted to determine the influence of defense expenditures on economic development. According to the conventional wisdom—which is encapsulated in the official policy of lending institutions such as the World Bank and International Monetary Fund (IMF)—government expenditures on national defense carry an opportunity cost in the form of lower economic output and slower rates of output growth.1 The theoretical assumption is that resources spent on preparation for war, and on warfighting itself, could be better employed elsewhere. In particular, the devotion of valuable human capital to military rather than civilian research and development is assumed to significantly retard economic growth. Thus, a popular assumption for researchers and policymakers alike is that the influence of military spending on economic growth is negative.

But the empirical evidence on the military expenditures—growth relationship is decidedly ambiguous. In a study of 44 developing economies, for example, Benoit (1973) found no evidence that defense spending has an adverse effect on growth. In fact, even after controlling for reductions in foreign investment and aid as a result of military spending, the correlation between military expenditures and economic growth remained positive. More recently, a study by Babin (1986) looked at 88 developing economies from 1965 to 1981.

____________________
1
See, for example, Nelson (1963), Benoit (1968), and Knight et al. (1996).

-5-

Notes for this page

Add a new note
If you are trying to select text to create highlights or citations, remember that you must now click or tap on the first word, and then click or tap on the last word.
One moment ...
Default project is now your active project.
Project items

Items saved from this book

This book has been saved
Highlights (0)
Some of your highlights are legacy items.

Highlights saved before July 30, 2012 will not be displayed on their respective source pages.

You can easily re-create the highlights by opening the book page or article, selecting the text, and clicking “Highlight.”

Citations (0)
Some of your citations are legacy items.

Any citation created before July 30, 2012 will labeled as a “Cited page.” New citations will be saved as cited passages, pages or articles.

We also added the ability to view new citations from your projects or the book or article where you created them.

Notes (0)
Bookmarks (0)

You have no saved items from this book

Project items include:
  • Saved book/article
  • Highlights
  • Quotes/citations
  • Notes
  • Bookmarks
Notes
Cite this page

Cited page

Style
Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

(Einhorn, 1992, p. 25)

(Einhorn 25)

1

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited page

Bookmark this page
Military Expenditures and Economic Growth
Table of contents

Table of contents

Settings

Settings

Typeface
Text size Smaller Larger Reset View mode
Search within

Search within this book

Look up

Look up a word

  • Dictionary
  • Thesaurus
Please submit a word or phrase above.
Print this page

Print this page

Why can't I print more than one page at a time?

Full screen
/ 116

matching results for page

Cited passage

Style
Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn, 1992, p. 25).

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn 25)

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences."1

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited passage

Thanks for trying Questia!

Please continue trying out our research tools, but please note, full functionality is available only to our active members.

Your work will be lost once you leave this Web page.

For full access in an ad-free environment, sign up now for a FREE, 1-day trial.

Already a member? Log in now.