The Impact of Defense Expenditure on Economic Growth

Laura Obreja Brasoveanu ()

Journal for Economic Forecasting, 2010, issue 4, 148-167

Abstract: The goal of this paper is to analyze the relationship between defense expenditures and economic growth in Romania, trying to find out the existence, direction and intensity of this connection. The methods which I used are cluster analysis, quintile analysis, regression technique and Granger causality. The results suggest that in Romania there is a negative correlation. A potential cause of the negative effect of defense expenditures on economic growth in Romania is the high proportion of the spending on equipment and other operational spending. Also I have considered the implications of the budgetary restriction – the limited resources might be given priority for other programs.

Keywords: fiscal policy; public expenditures; defense expenditures; economic growth; budget constraint (search for similar items in EconPapers)
JEL-codes: E62 H41 H56 H6 (search for similar items in EconPapers)
Date: 2010
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:rjr:romjef:v::y:2010:i:4:p:148-167

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