Military Expenditure in Third World Countries by Saadet Deger

By Saadet Deger

Saadet Deger discusses either the direct and oblique results that prime army expenditure has on an underdeveloped economic system.

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Definitions: mis military burden, y is per capita income; MO is exports of minerals and petroleum as percentage of total exports; u is share of population in urban areas; GR is government expenditure as a percentage share of GDP or GNP; GR (net) is the same, net of d~fence; POP14 is the percentage of population aged 14 or under; N 1s total population; D is the index of internationalisation as explained in the text; Dl and D2 are oil and war dummies. thus development produces an increase of the defence burden (m).

In a way the regression equation in column 6 is in accord with all three theories discussed above, but it is difficult to distinguish their effects separately. We have emphasised cross-section results, since the postulated theories are all for long-term steady states, and coefficients derived from cross-country variables tend to exhibit long-term properties. However, the fact that the military burden does not depend on growth, but is strongly influenced by per capita income, has also been observed in time series analysis for a single country.

SIPRI gives constant dollar figures (for each year) for the value of trade in major weapons with the Third World; exports are classified by country, and importers in LDCs by region. In addition, an important register of arms trade between industrialised and developing countries is provided which lists major weapons systems on order or delivery during a given year. Much useful information can be gleaned from this table, though the absence of weapons prices makes it less tractable for economists, who are usually more concerned with the value of trade.

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