Defense Spending and Economic Growth

Defense Spending and Economic Growth

Defense Spending and Economic Growth

Defense Spending and Economic Growth

Excerpt

This book examines the impact defense spending has on economic growth. While defense spending was not deliberately invented as a fiscal policy instrument, its importance in the composition of overall government spending and thus in determining employment is now easily recognized. In light of the collapse of the Soviet Union and the consequent reduction in the threat to the security of the United States, maintaining defense spending at the old level seems indefensible. The media has concentrated on the so-called peace dividend. However, as soon as the federal government is faced with defense cuts, it realizes the macroeconomic ramifications of such a step. Based on studies included in this volume, we examine the effects of defense spending on economic growth and investigate how the changed world political climate is likely to alter the importance and pattern of defense spending both for developed and developing countries.

The volume consists of fourteen chapters and is divided into five parts. The introductory part, besides presenting a background regarding the importance of defense spending in developed and developing countries, analyzes the different issues addressed in the book, relates them to the central theme and provides conclusions regarding the overall significance of defense spending for the economic growth of a nation. While studies included in this volume are fairly detailed, we recognize that not all points of view are equally represented. We have attempted to convey mainstream views without sacrificing the diversity of opinions.

We acknowledge the unqualified support of the contributing authors without which this volume would not have been possible. We also appreciate the cooperation and support provided by Eastern Kentucky University and Oakland University that enabled the timely completion of the project.

James E. Payne Anandi P. Sahu . . .

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