 The demand for military expenditures: An international comparisonLeonard Dudley and Claude Montmarquette Public Choice, 1981, vol. 37, issue 1, 5-31 Abstract: Earlier studies have explained inter-country variations in the share of GNP devoted to military expenditures by international spillovers and by differences in the threat of attack related to relative incomes. In this paper, we use the theory of public choice to explain these differences. We attempt to measure the importance of both international spillovers and relative incomes, along with two other factors: the tax-price elasticity of demand and economies of scale in the consumption of security. We find that international spillovers are significant and positive, that the income elasticity of demand is greater than unity, that the tax-price elasticity of demand explains part of observed inter-country differences, and that there are considerable economies of scale in the consumption of military spending. Finally, between 1960 and 1975, there was apparently a substantial increase in the value which each country derived from a dollar of military spending by its allies. This phenomenon, which seems related to the increased importance of deterrent weapons, has tended to induce individual alliance members to reduce the share of their national income devoted to defense. Copyright Martinus Nijhoff Publishers 1981 Date: 1981 Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:kap:pubcho:v:37:y:1981:i:1:p:5-31 Ordering information: This journal article can be ordered from DOI: 10.1007/BF00124229 Access Statistics for this article Public Choice is currently edited by WIlliam F. Shughart II More articles in Public Choice from Springer |
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