EconPapers    
Economics at your fingertips  
 

The Peace Dividend: Military Spending Cuts and Economic Growth

Malcolm Knight, Norman Loayza () and Delano Villanueva
Additional contact information
Malcolm Knight: International Monetary Fund

IMF Staff Papers, 1996, vol. 43, issue 1, 1-37

Abstract: Although conventional wisdom suggests that reducing military spending may improve a country's economic growth performance, empirical studies have produced ambiguous results. This paper extends a standard growth model and obtains consistent panel data estimates of the growth retarding effects of military spending via its adverse impact on capital formation and resource allocation. Simulation experiments suggest that a substantial long-run "peace dividend"--in the form of higher capacity output--may result from markedly lower military expenditure levels achieved in most regions during the late 1980s, and the further military spending cuts that would be possible if global peace could be secured.

JEL-codes: O41 O47 (search for similar items in EconPapers)
Date: 1996
References: Add references at CitEc
Citations: View citations in EconPapers (174)

Downloads: (external link)
http://www.jstor.org/stable/3867351?origin=pubexport main text (application/pdf)
Access to full text is restricted to subscribers.

Related works:
Working Paper: The Peace Dividend: Military Spending Cuts and Economic Growth (1995) Downloads
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:pal:imfstp:v:43:y:1996:i:1:p:1-37

Ordering information: This journal article can be ordered from
http://www.springer. ... cs/journal/41308/PS2

Access Statistics for this article

More articles in IMF Staff Papers from Palgrave Macmillan
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().

 
Page updated 2025-03-19
Handle: RePEc:pal:imfstp:v:43:y:1996:i:1:p:1-37