Catherine M. Kelleher, William Domke, Richard Eichenberg
May 21, 2016
This paper reports results of research on the so-called “guns/butter” question. Using multiple regression techniques, we estimate the relationship between military and social spending for the United States (1929-72), France (1920-1973), West Germany (1950-1969), and the United Kingdom (1920-1976). Reasoning from theories of budgeting, the controllability of social expenditures, and the effects of economic conditions on government resource allocation, we argue that “guns/butter tradeoffs” are unlikely to appear in short-term expenditure changes. The results generally confirm this hypothesis: only for the United States does a negative association appear between the two types of expenditure. For the other three countries, economic factors seem to be the driving force in social expenditure change.