Abstract
The rational justification for military effort is that it adds to the external and internal security of the body politic. Common sense suggests, however, that security can only be obtained subject to decreasing returns — each extra dollar devoted to the military will buy so much less extra defence. Within a country, resources directed toward civilian uses must be cut by increasing amounts as security rises.
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Notes and References
These points are documented in detail in the various SIPRI yearbooks. See, for example, Stockholm International Peace Research Institute, World Armaments and Disarmament SIPRI Yearbook, 1985 (Philadelphia: Taylor and Francis, 1985).
The development of indigenous third-world production is traced in Stephanie Neuman, ‘International Stratification and Third World Military Industries’, International Organization (Winter 1984), pp. 167–98.
Lance Taylor, ‘Military Economics in the Third World’, Massachusetts Institute of Technology (Mimeo) October 1981, p. 1.
Saadet Deger and Ron Smith, ‘Military Expenditure and Development: The Economic Linkages’, IDS Bulletin (October 1985), p. 50.
Steve Chan, ‘The Impact of Defense Spending on Economic Performance: A Survey of Evidence and Problems’, Orbis (Summer 1985), p. 415.
Ibid.
Emile Benoit, Defense and Economic Growth in Developing Countries (Lexington, MA: D. C. Heath, 1973). Also see his ‘Growth and Defense in Developing Countries’, Economic Development and Cultural Change (January 1978), pp. 271–80; ‘Growth Effects of Defense in Developing Countries’, International Development Review (1972), pp. 2–10 and ‘A Rejoinder to Professor Dorfman’s Comment, International Development Review, 1972, pp. 12–14. Criticism of Benoit’s approach can be found in Michael Brzoska and Herbert Wulf, ‘Rejoinder to Benoit’s Growth and Defense in Developing Countries — Misleading Results and Questionable Methods’, University of Hamburg (Mimeograph 1979); Riccordo Faiai and Patricia Avnez and Lance Taylor, ‘Defense Spending, Economic Structure and Growth: Evidence Among Countries and Over Time’, Economic Development and Cultural Change (April 1984), pp. 487–98 and Nicole Ball, ‘Defense and Development: A Critique of The Benoit Study’, in Helena Tuomi and Raimo Vayrynew (eds) Militarization and Arms Production (New York: St. Martin’s Press, 1983).
Chan, ‘The Impact of Defense Spending’, p. 416.
Taylor, ‘Military Economics in the Third World’, p. 3.
Ibid.
Saadet Deger and Ron Smith, ‘Military Expenditure and Growth in Less Developed Countries’, Journal of Conflict Resolution (June 1983), p. 346.
Cf. Ron Smith and George Georgiou, ‘Assessing the Effect of Military Expenditures on OECD Economies: A Survey’, Arms Control (May 1983), pp. 1–19; and R. Smith, ‘Military Expenditure and Investment in OECD Countries, 1954–1973’, Journal of Comparative Economics (March 1980), pp. 19–32.
Saadet Deger and Ron Smith, ‘Military Expenditure and Development, The Economic Linkages’, IDS Bulletin (October 1985) pp. 49–50.
Cf. R. E. Looney and P. C. Frederiksen, ‘Defense Expenditures, External Public Debt and Growth in Developing Countries’, Journal of Peace Research (December 1986), and P. C. Frederiksen and R. E. Looney, ‘Another Look at the Defense Spending and Development Hypothesis’, Defense Analysis (1985), p. 301.
Economic variables are from: The World Bank, World Development Report, 1984 (New York: Oxford University Press, 1984); savings variables are from: The World Bank, World Tables: The Third Edition, Vol. I, Economic Data (Baltimore: Johns Hopkins Press, 1983); and military variables are from United States Arms Control and Disarmament Agency, World Military Expenditures and Arms Transfers, 1972–82 (Washington: ACDA, 1984).
Arms producers are designated as those nations producing at least one major weapons system in 1980. Cf. Stephanie G. Neuman, ‘International Stratification of Third World Military Industries’, International Organization (Winter 1984), p. 173 for a list of the arms producers.
Taylor, ‘Military Economics in the Third World’, pp. 5–6.
Deger and Smith, ‘Military Expenditure and Growth’, p. 50.
The capital output ratio was found significantly by Lim in his analysis of the impact of military expenditures on growth. Cf. David Lim, ‘Another Look at Growth and Defense in Less Developed Countries’, Economic Development and Cultural Change (1983), pp. 377–84.
For an excellent survey of the inflationary processes likely to occur in developing countries see V. Corbolioi, Inflation in Developing Countries: An Econometric Study of Chilean Inflation (Amsterdam: North Holland, 1974), ch. 1.
A mechanism outlined in M. Bronfenbrenner and F. Hulzman, ‘A Survey of Inflation Theory’, in N. S. Buchanan (ed.), Surveys of Economic Theory (New York: St. Martins Press, 1965), pp. 61–3.
Ibid.
Deger and Smith, ‘Military Expenditure and Growth’, p. 50.
Stockholm International Peace Research Institute (SIPRI), The Arms Trade with the Third World (New York Humanities Press, 1971). See also Michael Brzoska, ‘The Military Related External Debt of Third World Countries’, Journal of Peace Research (1983), pp. 271–7; and Peter Tehral, ‘Foreign Exchange Costs of the Indian Military, 1950–72’, Journal of Peace Research (1982), pp. 251–9.
Ilan Peleg, ‘Military Production in Third World Countries: A Political Study’, in Pat McGowan and Charles Kegley (eds), Threats, Weapons and Foreign Policy (Beverly Hills: Sage Publishers, 1980), p. 210.
Chan, ‘The Impact of Defense Spending’, p. 431.
Martin Heisler, ‘Domestic Defense Expenditures: Theoretical Considerations in Comparative Perspective’, paper presented at the annual meeting of the International Studies Association, Cincinnati, March, 1982.
Chan, ‘The Impact of Defense Spending’, p. 431.
Deger and Smith, ‘Military Expenditure and Growth’, p. 52.
Ibid.
S. Deger and R. Smith, ‘Military Expenditure and Growth’.
S. Deger and S. Sen, ‘Defense and Development’ (mimeo, Birbeck College, 1986).
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© 1988 Robert E. Looney
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Looney, R.E. (1988). Macroeconomic Impacts of Third-World Arms Production. In: Third-World Military Expenditure and Arms Production. Palgrave Macmillan, London. https://doi.org/10.1007/978-1-349-09658-9_4
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