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Peace Economics, Peace Science and Public Policy

Editor-in-Chief: Caruso, Raul

Ed. by Bove, Vincenzo / Kibris, Arzu / Sekeris, Petros

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Volume 20, Issue 4

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Volume 17 (2011)

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Military Expenditure and Investment in OECD Countries: Revisited

Na Hou
  • Corresponding author
  • Center for Fiscal Development Research and Institute of Defence Economics and Management, Central University of Finance and Economics, Beijing 100081, China
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  • Other articles by this author:
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/ Bo Chen
  • Center for Fiscal Development Research and Institute of Defence Economics and Management, Central University of Finance and Economics, Beijing 100081, China
  • Other articles by this author:
  • De Gruyter OnlineGoogle Scholar
Published Online: 2014-10-07 | DOI: https://doi.org/10.1515/peps-2014-0031

Abstract

This study examines the effects of military expenditure on investment in 13 selected OECD countries over the period of 1971–2012 by applying the Smith Demand-Side model and different estimation methodologies including panel data, cross section and time series estimation methods. Our empirical results reveal that military expenditure crowds out investment and that crowding-out effect lessens during the Post-Cold War period.

Keywords: military expenditure; investment; the demand side model; the crowding-out effect; the OECD countries

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About the article

Corresponding author: Na Hou, Center for Fiscal Development Research and Institute of Defence Economics and Management, Central University of Finance and Economics, Beijing 100081, China, E-mail:


Published Online: 2014-10-07

Published in Print: 2014-12-01


Citation Information: Peace Economics, Peace Science and Public Policy, Volume 20, Issue 4, Pages 621–630, ISSN (Online) 1554-8597, ISSN (Print) 1079-2457, DOI: https://doi.org/10.1515/peps-2014-0031.

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