The Peace Dividend : Military Spending Cuts and Economic Growth /

Although conventional wisdom suggests that reducing military spending may improve a country's economic growth performance, empirical studies have produced ambiguous results. This paper extends a standard growth model and estimates it using techniques that exploit both cross-section and time-ser...

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Detalles Bibliográficos
Autor Principal: Knight, Malcolm
Outros autores: Loayza, Norman, Villanueva, Delano
Formato: Revista
Idioma:English
Publicado: Washington, D.C. : International Monetary Fund, 1995.
Series:IMF Working Papers; Working Paper ; No. 1995/053
Acceso en liña:Full text available on IMF
Descripción
Summary:Although conventional wisdom suggests that reducing military spending may improve a country's economic growth performance, empirical studies have produced ambiguous results. This paper extends a standard growth model and estimates it using techniques that exploit both cross-section and time-series dimensions of available data to obtain consistent estimates of the growth-retarding effects of military spending via its adverse impact on capital formation and resource allocation. Model simulations suggest that a substantial long-run 'Peace Dividend'--in the form of higher capacity output--may result from: (i) markedly lower military expenditure levels achieved in most regions during the late 1980s; and (ii) further military spending cuts that would be possible in the future if a global peace could be secured.
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Descrición Física:1 online resource (40 pages)
Formato:Mode of access: Internet
ISSN:1018-5941
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