Forecasting and Analyzing the Military Expenditure of India Using Box-Jenkins ARIMA Model

Deepanshu Sharma and Kritika Phulli

Papers from arXiv.org

Abstract: The advancement in the field of statistical methodologies to economic data has paved its path towards the dire need for designing efficient military management policies. India is ranked as the third largest country in terms of military spender for the year 2019. Therefore, this study aims at utilizing the Box-Jenkins ARIMA model for time series forecasting of the military expenditure of India in forthcoming times. The model was generated on the SIPRI dataset of Indian military expenditure of 60 years from the year 1960 to 2019. The trend was analysed for the generation of the model that best fitted the forecasting. The study highlights the minimum AIC value and involves ADF testing (Augmented Dickey-Fuller) to transform expenditure data into stationary form for model generation. It also focused on plotting the residual error distribution for efficient forecasting. This research proposed an ARIMA (0,1,6) model for optimal forecasting of military expenditure of India with an accuracy of 95.7%. The model, thus, acts as a Moving Average (MA) model and predicts the steady-state exponential growth of 36.94% in military expenditure of India by 2024.

Date: 2020-11
New Economics Papers: this item is included in nep-ets and nep-for
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://arxiv.org/pdf/2011.06060 Latest version (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:arx:papers:2011.06060

Access Statistics for this paper

More papers in Papers from arXiv.org
Bibliographic data for series maintained by arXiv administrators ().