Economic Policies and Research

Current Issue

By Issue

By Author

By Subject

Author Index

Keyword Index

About Journal

Aims and Scope

Editorial Board

Publication Ethics

Indexing and Abstracting

Related Links

FAQ

Peer Review Process

Journal Metrics

News

Investigating factors affecting military spending in selected countries of the Middle East: Examining the hypothesis of military competition

Document Type : Original Article

Authors

1 Associate Professor of Economics, Department of Economics, Faculty of Economics and Social Sciences, Shahid Chamran University, Ahvaz, Iran

2 Master of Economics, Department of Economics, Faculty of Economics and Management, Tabriz University, Tabriz, Iran

3 Phd in Urban Economics, Department of Economics, Faculty of Economics and Social Sciences, Shahid Chamran University, Ahvaz, Iran

https://doi.org/10.34785/J025.2022.022

Abstract

The Middle East is one of the most turbulent and tense regions in the world, which has been the site of many tensions at the national and international level since the past due to political, social, economic factors and abundant energy resources. Among the variables that have always been growing in the Middle East countries in recent decades- especially the oil countries, is defense spending, which has been affected by various factors. Examining the factors affecting defense spending in the Middle East countries will have broad policy implications for the countries-of this region and can be very useful. Therefore, the purpose of this article was.to investigate.factors affecting the demand function of military expenditures in the Middle East countries during the period of 1980-2019 with the quantile regression approach. The results of this study showed that GDP, oil price, foreign trade had.a.positive effect and civilian spending had a positive effect on foreign defense. Also, the military expenditures of other countries have had a positive and significant impact-on the-military expenditures of each country, which means.confirming the hypothesis of military.competition in the studied countries. Based on the other results of this study, the.effect of the effective factors on defense-spending in the studied.countries.was symmetrical.

Keywords

Main Subjects

References
Abdelfattah, Y. M., Abu-Qarn, A., & Dunne, P. (2013). The demand for military spending in Egypt. Defense and Peace Economics.
Alonso, M. A., & Martínez, A. (2007). Los determinantes del gasto militar en los países europeos de la Alianza Atlántica: Un estudio a través de un modelo de datos de panel para el período 1975-2005. 9th Global Economic Congress, Madrid.
Benoit, E. (1978). Growth and defense in developing countries. Economic Development and Cultural Change, 26(2), 271-280.
Bove, V., & Cavatorta, E. (2012). From conscription to volunteers: Budget shares in NATO defence spending. Defence and Peace Economics, 23(3), 273-288.
Christie, H., Buts, C., & Bois, C. D. (2022). Demand for military expenditures and security alignment choices in the Indo-Pacific. Journal of Defence and Peace Economics, 43, 1-22.
Dudzeviciute, G., & Simelyte, A. (2022). The impact of economic determinants on the defense burden in selected NATO countries. Journal of Public Policy and Administration, 21, 9-21.
Dunne, J. P., & Smith, R. P. (2010). Military expenditure and Granger causality: A critical review. Defense and Peace Economics, 21, 427-441.
Flynn, E. (2013). Military leadership, institutional change, and priorities in military spending. Foreign Policy Analysis.
George, J., & Sandler, T. (2017). Demand for military spending in NATO, 1968–2015: A spatial panel approach. European Journal of Political Economy, 189-203.
Golkhandan, A. (2016). Estimation of demand function of military expenditure in Iran. Quarterly Journal of Military Sciences and Techniques, 36, 29-55. (In Persian)
Hartley, K., & Sandler, T. (2011). The Economics of Defence Spending. Abingdon: Routledge.
Hartley, K. (2011). The Economics of Defence Policy: A New Perspective. London and New York: Routledge.
Im, K. S., Pesaran, M. H., & Shin, Y. (1997). Testing for unit roots in heterogeneous panels. DAE, Working Paper 9526, University of Cambridge.
Enayatalahi, S., & Baghestani, M. (2016). Estimation of the demand function of net expenditure in Iran. Defense Economy Quarterly, 3, 43-58. (In Persian)
Jeon, J. Y. (2008). The aggregate growth and sectoral changes of technology in the Korean economy (Doctoral thesis). Korea: Sogang University. (In Korean)
Koenker, R., & Bassett, J. R. (1978). Regression quantiles. Econometrica, 46(1), 33-50.
Kollias, C. (2004). The Greek-Turkish rapprochement, the underlying military tension and the Greek defense spending. Turkish Studies, 5(1), 99-116.
Kollias, C., & Paleologou, S. M. (2003). Domestic political and external security determinants of the demand for Greek military expenditure. Defence and Peace Economics, 14(6), 437-445.
Levin, A., Lin, C. F., & Chu, C. S. J. (2002). Unit root test in panel data: Asymptotic and finite sample properties. Journal of Econometrics, 108, 1-24.
Li Fan, H., Liu, W., & Coyte, P. C. (2018). Do military expenditures crowd out health expenditures? Evidence from around the world, 2000-2013. Defence and Peace Economics, 29(7), 766-779.
Lin, F. L., & Wang, M. C. (2019). Does economic growth cause military expenditure to go up? Using MFVAR model. Quality & Quantity, 53, 3097-3117.
Mahdavi, H., & Adeli, O. (2019). Estimating the demand function for military expenditures in Persian Gulf countries: Static and dynamic approach. Quarterly Journal of Interdisciplinary Studies of Strategic Knowledge, 38, 313-330. (In Persian)
Malik, T. H. (2018). Defence investment and the transformation national science and technology: A perspective on the exploitation of high technology. Technological Forecasting and Social Change, 127, 199-208.
Malizard, J. (2015). Does military expenditure crowd out private investment? A disaggregated perspective for the case of France. Economic Modelling, 46, 44-52.
Manamperi, N. (2016). Does military expenditure hinder economic growth? Evidence from Greece and Turkey. Journal of Policy Modeling, 38(6), 1171-1193.
Moulai, M., Golkhandan, A., & Golkhandan, D. (2013). The relationship between defense spending and economic growth in Iran. Economic Strategy Quarterly, 9, 73-99. (In Persian)
Murdoch, J. C., & Sandler, T. (1984). Complementarity, free riding, and the military expenditures of NATO allies. Journal of Public Economics, 25(1-2), 83-101.
Odehnal, J., Neubauer, J., Olejníček, A., Boulaouad, J., & Brizgalová, L. (2021). Empirical analysis of military expenditures in NATO nations. Economies, 9, 107.
Olson, M., & Zeckhauser, R. (1966). An economic theory of alliances. Review of Economic Statistics, 48, 266-274.
Pérez-Forniés, C., Gadea, M. D., & Pardos, E. (2004). Gasto en defensa y renta en los países de la Alianza Atlántica. Hacienda Pública Española, 170(3), 137-153.
Qiong, L., & Hu, J. (2015). Military expenditure and unemployment in China. Procedia Economics and Finance, 30, 498-504.
Raju, M. H., & Ahmed, Z. (2019). Effect of military expenditure on economic growth: Evidences from India, Pakistan and China using cointegration and causality analysis. Asian Journal of German and European Studies, 4(3), 171-192.
Sandler, T., & Murdoch, J. (2000). On sharing NATO defence burdens in the 1990s and beyond. Fiscal Studies, 21(3), 297-327.
Shahbaz, M., Afza, T., & Shabbir, M. S. (2013). Does defence spending impede economic growth? Cointegration and causality analysis for Pakistan. Defence and Peace Economics, 24(2), 105-120.
Solar, C. (2022). Thinking beyond averages: Quantile regression modelling and military expenditure. Journal of Bulletin of Sociological Methodology/Bulletin de Méthodologie Sociologique, 155, 82-105.
Stockholm International Peace Research Institute. (2022). www.sipri.org.
Throsby, D., & Withers, G. A. (2001). Individual preferences and the demand for military expenditure. Defence and Peace Economics, 12, 87-102.
Waszkiewicz, G. (2018). Defence spending and economic growth in the Visegrad countries. Panoeconomicus, 67(4), 539-556.
World Bank Indicator. (2022). www.worldbank.org.
Yang, H., Hong, C., Jung, S., & Lee, J. (2015). Arms or butter: The economic effect of an increase in military expenditure. Journal of Policy Modeling, 24, 65-79.
Zhang, Y., Liu, X., Xu, J., & Wang, R. (2018). Does military spending promote social welfare? A comparative analysis of the BRICS and G7 countries. Defence and Peace Economics, 28(6), 686-702.
Zhang, Y., Wang, R., & Yao, D. (2017). Does defence expenditure have a spillover effect on income inequality? A cross-regional analysis in China. Defence and Peace Economics, 28(6), 731-749.
Economic Policies and Research
Volume 1, Issue 3
November 2022
Pages 54-79
Files
Share
How to cite
Statistics