Recent research on the determinants of Third World military expenditures has indicated that economic variables show great promise in providing a framework as to the underlying causes of Third World defense allocation decisions. Building on this research, we test the hypotheses that the level of military expenditures in developing countries is determined in large part by economic constraints relative to external (threat) factors. In general this hypothesis is borne out with the important qualification that countries without an arms industry appear relatively more affected by external factors than countries with an arms industry. The main implication of the analysis is that a reduction in Third World arms production would most likely result in lower overall levels of military expenditures in these countries.
Get full access to this article
View all access options for this article.
References
1.
Alexander, Arthur ; William Butz & Michael Mihalka, 1981. Modeling the Production and International Trade of Arms: An Economic Framework for Analyzing Policy Alternatives. Santa Monica: Rand.
2.
Ames, Barry & Ed Goff, 1975. `Education and Defense Expenditures in Latin America: 1948-1968,' in Craig Ilske, ed. Comparative Public Policy: Issues, Theories, and Methods. New York: Wiley.
3.
Ayres, Ron , 1983. `Arms Production as a Form of Import-Substituting Industrialization: The Turkish Case', World Development, vol. 11, no. 1, pp. 813-824.
4.
Ball, Nicole , 1983. `Defense and Development: A Critique of the Benoit Study', pp. 39-56 in Helena Tuomi & Raimo Väyrynen, eds. Militarization and Arms Production. New York: St. Martin's.
5.
Benoit, Emile , 1978. `Growth and Defense in Developing Countries', Economic Development and Cultural Change, vol. 26, no. 2, pp. 271-280.
6.
Brzoska, Michael , 1983. `The Military-Related External Debt of Third World Countries', Journal of Peace Research, vol. 20, no. 3, pp. 271-277.
7.
Chan, Steve , 1985. `The Impact of Defense Spending on Economic Performance: A Survey of Evidence and Problems', Orbis, vol. 29, no. 2, pp. 403-434.
8.
Chan, Steve , 1987. `Military Expenditures and Economic Performance', pp. 29-38 in United States Arms Control and Disarmament Agency, World Military Expenditures and Arms Transfers. Washington: ACDA.
9.
Clare, Joseph , 1987. `Whither the Third World Producers', pp. 23-28 in United States Arms Control and Disarmament Agency, World Military Expenditures and Arms Transfers, 1986. Washington: ACDA.
10.
Deger, Saadet, 1981. `Human Resources, Government Education Expenditure and the Military Burden in Less Developed Countries', Discussion Paper, No. 109, Birkbeck College.
11.
Deger, Saadet & Ron Smith, 1983. `Military Expenditures and Growth in Less Developed Countries', Journal of Conflict Resolution, vol. 27, no. 2, pp. 335-353.
12.
Frederiksen, Peter C. & C. J. LaCivita, 1987. `Defense Spending and Economic Growth: Time Series Evidence of Causality for the Philippines. 1956-82', Journal of Philippine Development.
13.
Frederiksen, Peter, C. & Robert E. Looney, 1982. `Defense Expenditures and Economic Growth in Developing Countries: Some Further Empirical Evidence', Journal of Economic Development, vol. 7, no. 1, pp. 113-124.
14.
Frederiksen, Peter C. & Robert E. Looney, 1983. `Defense Expenditures and Growth in Developing Countries', Armed Forces and Society, vol. 9, no. 4, pp. 633-645.
15.
Frederiksen, Peter C. & Robert E. Looney, 1985. `Another Look at the Defense Spending and Development Hypothesis', Defense Analysis, vol. 3, no. 1, pp. 205-210.
16.
Griffin, L. J. ; M. Wallace & J. Devine, 1982. `The Political Economy of Military Spending: Evidence From the United States', Cambridge Journal of Economics, vol. 6, no. 1, pp. 1-14.
17.
Harris, Geoffrey , 1986. `The Determinants of Defense Expenditures in the ASEAN Region', Journal of Peace Research, vol. 23, no. 1, pp. 41-49.
18.
Joerding, Wayne , 1986. `Economic Growth and Defense Spending: Granger Causality', Journal of Development Economics, vol. 21, no. 1, pp. 35-40.
19.
Looney, Robert E. , 1986a. `Determinants of Per Capita Military Expenditures in Developing Countries', Manchester Papers on Development, vol. 2, no. 3, pp. 1-21.
20.
Looney, Robert E. , 1986b. `Military Expenditures in Latin America: Patterns of Budgetary Tradeoffs', Journal of Economic Development, vol. 11, no. 1, pp. 69-104.
21.
Looney, Robert E. , 1986c. `Factors Underlying Venezuelan Defense Expenditures, 1950-83: A Research Note', Arms Control, vol. 7, no. 1, pp. 74-101.
22.
Looney, Robert E. , 1987a. `Impact of Military Expenditures on Third World Debt', Canadian Journal of Development Studies, vol. 8, no. 1, pp. 7-26.
23.
Looney, Robert E. , 1987b. `Macroeconomic Impacts of Third World Mineral Production', Manchester Papers on Development, vol. 3, no. 1, pp. 1-23.
24.
Looney, Robert E. , 1988a. `Environments Conducive to Third World Arms Production', Journal of Economic Development (1988, forthcoming).
25.
Looney, Robert E. , 1988b. `Financial Constraints on Potential Latin American Arms Producers', Current Research on Peace and Violence, vol. 10, no. 4, pp. 159-168.
26.
Looney, Robert E. , 1988c. `Budgetary Impacts of Third World Arms Production', International Journal of Public Administration (1988, forthcoming).
27.
Looney, Robert E. , 1988d. `Determinants of Military Expenditures in Developing Countries', Arms Control, vol. 8, no. 3, pp. 295-324.
28.
Looney, Robert E. & Peter C. Frederiksen, 1986a. `The Future Demand for Military Expenditure in Argentina', Arms Control, vol. 7, no. 2, pp. 197-204.
29.
Looney, Robert E. & Peter C. Frederiksen, 1986b. `Defense Expeditures, External Public Debt and Growth in Developing Countries', Journal of Peace Research, vol. 23, no. 4, pp. 329-338.
30.
Looney, Robert E. & Peter C. Frederiksen, 1986c. `Profiles of Current Latin American Arms Producers', International Organization, vol. 40, no. 3, pp. 745-752.
31.
Looney, Robert E. & Peter C. Frederiksen, 1987a. `The Impact of Latin American Arms Production on Economic Performance', Journal of Economic, Social and Political Studies, vol. 12, no. 3, pp. 309-320.
32.
Looney, Robert E. & Peter C. Frederiksen, 1987b. `Economic Environments and Third World Arms Production', Defense Analysis, vol. 3, no. 1, pp. 80-81.
33.
Looney, Robert E. & Peter C. Frederiksen, 1987c. `The Impact of Public Enterprises on Growth in Latin America: The Case of Defense Industries', in Edgar Ortiz, ed. Proceedings of the International Symposium on the Public Enterprise, Mexico City, July 1985, Mexico City: CIDE, pp. 377-387.
34.
Looney, Robert E. & Peter C. Frederiksen, 1988. `Economic Determinants of Latin American Defense Expenditures', Armed Forces and Society, vol. 14, no. 3, pp. 459-471.
35.
Looney, Robert E. & Craig Knouse, 1987. `Profiles of Third World Mineral Producers', Resources Policy, vol. 13, no. 1, pp. 55-67.
36.
Maizels, Alfred & Machiko Nissanke, 1986. `The Determinants of Military Expenditures in Developing Countries', World Development, vol. 14, no. 9, pp. 1125-1140.
37.
Neuman, Stephanie , 1984. `International Stratification and Third World Military Industries', International Organization, vol. 38, no. 1, pp. 167-198.
38.
O'Leary, Michael & William Coplin, 1975. `Explaining Military Expenditures in Latin America', pp. 112-142 in M. O'Leary & William Coplin, Quantitative Techniques in Foreign Policy: Analysis and Forecasts. New York: Praeger.
39.
Pindyck, Robert S. & Daniel Rubenfeld, 1976. Econometric Models and Economic Forecasts. New York: McGraw Hill.
40.
Richardson, Lewis F. , 1960. Arms and Insecurity. Chicago: Quadrangle.
41.
Shubik, Martin & Paul Bracken, 1983. `Strategic Purpose and the International Economy', Orbis, vol. 27, no. 3, pp. 567-591.
42.
Stockholm International Peace Research Institute , 1986. World Armaments and Disarmament: SIPRI Yearbook, 1986. Philadelphia: Taylor & Francis.
43.
Thorn, Richard S. , 1967. `The Evolution of Public Finances During Economic Development', The Manchester School of Economic and Social Studies, vol. 37, no. 3.
44.
Treddenick, John , 1985. `The Arms Race and Military Keynesianism', Canadian Public Policy, vol. 11, no. 1, pp. 77-92.
45.
Tulberg, Rita , 1986. `World Military Expenditures', Bulletin of Peace Proposals, vol. 17, nos. 3-4, pp. 229-234.
46.
Vener, James , 1983. `Budgetary Tradeoffs Between Education and Defense in Latin America: A Research Note', Journal of Developing Areas, vol. 18, no. 1, pp. 77-92.
47.
Weede, Erich , 1986. `Rent Seeking, Military Participation, and Economic Performance in LDCs', Journal of Conflict Resolution, vol. 30, no. 2, pp. 291-314.
48.
Westing, Arthur , 1979. `Military Expenditures and Their Reduction', Bulletin of Peace Proposals, vol. 16, no. 1, pp. 24-29.
49.
Whynes, David , 1979. The Economic of Third World Military Expenditures. Austin: The University of Texas Press.
50.
World Bank , 1983. World Tables. The Third Edition: Volume I, Economic Data. Baltimore: Johns Hopkins Press.
51.
World Bank , 1984. World Development Report. New York: Oxford University Press.
52.
World Bank , 1985. World Development Report. New York: Oxford University Press.
53.
World Bank , 1986. World Development Report. New York: Oxford University Press.
