War, mobilization, and fiscal capacity: testing the bellicist theory in Greece, 1833-1939

Andreas Kakridis
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Andreas Kakridis: Department of Political Science and History, Panteion University, Athens, Greece and Bank of Greece, Athens, Greece

No 327, Working Papers from Bank of Greece

Abstract: Constructing a new dataset of Greek public revenues and expenditures for the years 1833 to 1939, this paper finds that war mobilizations undermined tax revenues in the short run, but helped the Greek state increase its fiscal capacity in the long run. Tax revenues increased on the heels of major spikes in defense expenditures, even in cases where mobilizations did not escalate to war. But even in normal times, changes in mili-tary expenditures had a stronger effect on taxes, compared to similar changes in civil-ian outlays. The paper thus provides both data and evidence in support of bellicist theories of state formation for Greece, while also proposing a new approach to testing for the effects of war on fiscal capacity.

Keywords: War; taxation; fiscal capacity; military expenditures; state-formation (search for similar items in EconPapers)
JEL-codes: H6 N43 N44 (search for similar items in EconPapers)
Pages: 57
Date: 2024-03
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