The relationships between political stability, military expenditures, arms imports, and oil exports: a CS-DL approach for six Gulf countries

Slim Ben Youssef

MPRA Paper from University Library of Munich, Germany

Abstract: We consider the relationships between military expenditures, arms imports, political stability, oil exports, gross domestic product, and greenhouse gas emissions in a panel of six oil-exporting countries of the Gulf region and annual data ranging from 2000 to 2023. Second-generation panel unit root and cointegration tests are used because of the cross-sectional dependence between our considered variables. The cross-sectional distributed lag (CS-DL) methodology is performed to estimate our long-run coefficients. Several novel results are highlighted. In the long-run, arms imports increase political stability and economic growth. While military expenditures increase oil exports, arms imports slightly reduce them. Oil exports increase military expenditures but reduce arms imports. Political stability reduces military expenditures and increases gross domestic product. These oil-exporting Gulf countries are advised to reinforce their military efforts, in particular by planning the production of high-tech weapons, to improve their oil exports and thus their gross domestic product. Economic growth combined with political stability enables them to become producing and exporting renewable energy countries through adequate energy efficiency and renewable energy strategies.

Keywords: Military expenditures; arms imports; political stability; oil exports; cross-sectional distributed lag; Gulf countries. (search for similar items in EconPapers)
JEL-codes: C33 H56 O53 Q37 (search for similar items in EconPapers)
Date: 2025-05-01
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