The Economic Cost of A Nuclear Weapon: A Synthetic Control Approach

Anthony A. Mayberry

Defence and Peace Economics, 2023, vol. 34, issue 6, 747-766

Abstract: This study estimates the economic effects of nuclear weapons development efforts in Pakistan using synthetic control group methods. Pakistan started its nuclear weapons program in 1972 and conducted its first test in 1998. This paper focuses on the growth impacts during the 1973 to 1997 period, before Pakistan established itself as a nuclear power. I create a synthetic control group for Pakistan using Per capita Gross Domestic Product (GDP) from the 1950 to 1972. The impact of the nuclear weapons development program is measured as a treatment dummy for the years 1973–1997 in a Difference-in-Difference model. I find that Pakistan’s per capita GDP would have been an average of about $718 per year higher had the country not undertaken the effort to produce a nuclear weapon. This equates to per capita GDP being 27.8% lower on average over the 25-year weapons-development period. Results are robust to several alternative specifications, including country exclusion, sparse synthetic controls, non-outcome characteristics as predictors of GDP, and in-space placebo experiments of differing specifications.

Date: 2023
References: Add references at CitEc
Citations:

Downloads: (external link)
http://hdl.handle.net/10.1080/10242694.2022.2065186 (text/html)
Access to full text is restricted to subscribers.

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:taf:defpea:v:34:y:2023:i:6:p:747-766

Ordering information: This journal article can be ordered from
http://www.tandfonline.com/pricing/journal/GDPE20

DOI: 10.1080/10242694.2022.2065186

Access Statistics for this article

Defence and Peace Economics is currently edited by Professor Keith Hartley

More articles in Defence and Peace Economics from Taylor & Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().