The Impact of Defense Investment on Economic Growth in the Perspective of Time Series: A Case Study of China

Bin Pan, Shih-Yung Wei, Xuanhua Xu and Wei-Chiang Hong
Additional contact information
Bin Pan: Academy of Finance Research, Wenzhou University, Zhejiang, China
Shih-Yung Wei: Academy of Finance Research, Wenzhou University, Zhejiang, China
Xuanhua Xu: School of Business, Central South University, Changsha, China
Wei-Chiang Hong: Department of Information Management, Oriental Institute of Technology, New Taipei, Taiwan

International Journal of Applied Evolutionary Computation (IJAEC), 2014, vol. 5, issue 4, 44-58

Abstract: By considering the demand and supply effects of defense investment and the uncertainty of the stochastic process of the production and defense investment, this study proposes a stochastic endogenous growth model to explore the impact of defense investment on economic growth. The results suggest that the relationship between defense investment and economic growth rate is nonlinear and obtains the optimal percentage of defense investment to maximize economic growth. Moreover, the impact of defense investment volatility on economic growth rate is subject to production and defense investment interference term's covariance and representative private investment risk preference. Finally, the empirical data are used to illustrate the applicability of the proposed model.

Date: 2014
References: Add references at CitEc
Citations:

Downloads: (external link)
http://services.igi-global.com/resolvedoi/resolve. ... 018/IJAEC.2014100104 (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:igg:jaec00:v:5:y:2014:i:4:p:44-58

Access Statistics for this article

International Journal of Applied Evolutionary Computation (IJAEC) is currently edited by Sukhpal Singh Gill

More articles in International Journal of Applied Evolutionary Computation (IJAEC) from IGI Global
Bibliographic data for series maintained by Journal Editor ().