Externalities in Military Spending and Growth: The Role of Natural Resources as a Channel through Conflict

Vusal Musayev ()

MPRA Paper from University Library of Munich, Germany

Abstract: This analysis re-examines the relationship between military spending and economic growth using recent advances in panel estimation methods and a large panel dataset. The investigation is able to reproduce many of results of the existing literature and to provide a new analysis on the relationship between conflict, corruption, natural resources and military expenditure and their direct and indirect effects on economic growth. The analysis finds that the impact of military expenditure on growth is generally negative as in the literature, but that it is not significantly detrimental for countries facing either higher internal or external threats and for countries with large natural resource wealth once corruption levels are accounted for.

Keywords: Military expenditure; Economic Growth; Conflict; Natural Resources, Corruption (search for similar items in EconPapers)
JEL-codes: H56 O11 Q34 (search for similar items in EconPapers)
Date: 2013-04
New Economics Papers: this item is included in nep-fdg, nep-gro and nep-pbe
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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:59784

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