Military spending and economic growth in South Africa

Peter Batchelor, J. Paul Dunne, David S. Saal

Research output: Contribution to journalArticle

Abstract

This paper undertakes an empirical analysis of the economic effects of military spending on the South African economy. It estimates a neo-classical model common in the literature at the level of the macroeconomy and at the level of the manufacturing sector. An attempt is made to improve upon the model by allowing the data to determine the dynamic structure of the model through an ARDL procedure. No significant impact of military spending is found in aggregate, but there is a significant negative impact for the manufacturing sector. This suggests that the cuts in domestic military procurement that have occurred since 1989 could lead to improved economic performance in South Africa through their impact on the manufacturing sector.
Original languageEnglish
Pages (from-to)553-571
Number of pages19
JournalDefence and Peace Economics
Volume11
Issue number4
DOIs
Publication statusPublished - 2000

Keywords

  • military spending
  • growth
  • South Africa
  • externalities

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