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To determine the association between military expenditure (ME) and public investment efficiency, I regressed a measure of public investment effectiveness upon a measure of ME in a cross-section of 59 developing countries. A strong association was only observed for Sub-Saharan Africa. One of the main explanations for the strong association is a relatively big government which was accompanied by government operations being inefficient and corrupt. This served as a reason to separately observe group of regions with relatively small and big governments. The results confirmed that the effect of ME on public investment effectiveness in the group with a relatively big government is negative whereas the effect is positive in group of region with small governments. Thus, it confirms that the increase of ME is not always negative but can in some cases improve the effectiveness of public investment.

This dissertation firstly examines literature connected to this topic in chapter 2. Secondly, chapter 3 summarizes necessary methodology and data used throughout the dissertation. Thirdly, it compares the results of military expenditure made by Cobb-Douglas-Solow production function forecast and an Auto regressive model, in chapter 4. Fourthly, in the chapter 5, with a better performing model, it forecasters the military expenditure from 2015 to 2024 for France, Germany, UK and Italy, because they represent more than 65% of European military expenditure and should give us an idea about the course of the European expenditure as a whole. Also, it compares forecasted expenditure of European NATO countries and USA with Canada for the same period. Finally, in chapter 6, we examine whether there is Granger causality between MS and GDP. Simply, if MS Granger causes GDP and vice versa. It was found that AR is a better performing forecasting technique than CDS and that Granger causality results are ambiguous. GDP Granger causes MS only for France and Italy and there is no evidence of opposite causality.

A FAREWELL TO ARMS: NON-MILITARISATION AND THE PARADOX OF MILITARY INSECURITY Nathan James Frank Williams Abstract A small number of scholars and political leaders have praised the economic and social benefits of 'non-militarisation' - the policy of possessing no national armed forces. While 26 states currently practice this policy, the security implications of non-militarisation have, until now, largely escaped critical assessment. However, it is this very question of security in the absence of a military which is perhaps the decisive issue for any state considering non- militarisation. Barbey's (2015b) study suggests that, since World War II, non-militarised states have been immune to interstate war. However, since World War II, intrastate war has proven to be both the more frequent and destructive form of warfare. Using a mixed-methods approach this dissertation seeks to quantify and explain the causal effect of non-militarisation on intrastate conflict. It begins by testing the hypothesis that non-militarised states suffer less years of intrastate war than states with a military, using cross-sectional logit analysis on all country-years between 1989-2008. It consistently finds a sizable negative relationship, suggesting that in a given year the probability of intrastate war occurring in a...

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This paper aims to measure the relationship between systemic vulnerability and government development investments. Systemic vulnerability is a concept introduced by Doner et al. (2005), which suggests that broad coalitions, severe external threats and scarce resources will lead to developmental states. Developmental states have several definitions that can generally be divided into structural and ideological features. Structural features include aspects related to state capacity and bureaucratic robustness, while ideological features refer to a stated goal of development. However, the term “developmental state” is also used as a political buzzword, which has diluted the academic concept. Education investments are used as a proxy for development investments because of the long-term societal and economic benefits that education has in a society. The study combines theories of political behavior, state-building and rentier states for the argument that systemic vulnerability should be positively correlated with education investments. Analysis is based on data from 73 countries and it shows that only some components of systemic vulnerability are correlated with education investments. The weak relationship between scarce resources and education investment follows the expected trend, while the relationship between external threat and education investment is unexpectedly negative. The broad coalitions show no statistically significant correlation between coalition size and education investment. These findings make a contribution to the field of development studies by expanding the understanding of the impact that systemic vulnerability has on development, since there has not been a large-n test of the concept on development investments before.

There is a lack of consensus on the empirical findings in research examining the so-called ‘guns and butter’ argument – does military expenditure crowd out social expenditure or not? Feminist scholars have been arguing that militarism, affects women’s welfare in a negative way. This study investigates whether countries' increase in military expenditure leads to a deterioration in women's health and education, based on the guns and butter argument. The study intends to find out what a possible correlation looks like for two different models, one that represents the impact on women's health and another that represents the impact on women's education, by using maternal mortality and school enrollment (with a gender parity index) as dependent variables. The survey is conducted for a sampling of countries in Africa, the Middle East, and South Asia for the period 1988 to 2020. The main findings of this study indicate that increased military expenditure leads to increased maternal mortality, however, the study finds no linear relationship between military expenditure and girls' school enrollment. The study also finds no correlation between health care, education expenditure and maternal mortality. Nevertheless, it indicates that education expenditure has a positive effect on girls’ school enrollment, and health care expenditure has a negative effect on girls’ school registration.

This study explores the relationship between human development and military expenditure across a broad spectrum of developing countries. The United Nations Development Programme releases an annual report on the state of human development in the world. The report includes four composite measurements of different aspects of human development: Human Development Index, Human Poverty Index, Gender-related Development Index and Gender Empowerment Measure. This study uses multiple regression to determine the existence and strength of causal relationships between the independent variables and different measurements of military expenditure. Special attention is provided to the role of gender empowerment in shaping the behavior of countries. Attention is also paid to the unique human development and military issues of the Middle East, although countries on every continent are included in the analysis. The study concludes that Military Expenditure as a proportion of central government spending is moderately influenced by human development in general and strongly influenced by gender empowerment in particular. On the other hand, human development has a more limited impact on Military Expenditure as a proportion of Gross Domestic Product.

<p>“Armaments and Economic Performance”. The literature on military expenditure (milex) is scrutinized with respect to five areas. <i>Investment</i> is reduced when milex increases. Most studies have found <i>economic growth </i>hindered by higher milex. No clear association between milex and <i>employment</i> is found. However, the same amount of other public expenditure creates more jobs. There is some evidence for milex as <i>counter-cyclical instrument</i> in the US. The result for studies if milex is used in <i>electoral cycles</i> in the US is contradictory. Disaggregated data are emphasized as a possible solution to get more definite results.</p><p>“The Economic Costs of Civil Wars”. The empirical studies of the economic costs of internal armed conflicts are divided into <i>accounting</i> and <i>modelling</i> methods. Cost is seen as the difference between the counterfactual production without conflict and the actual production. The average economic cost of internal armed conflict is a 3.7% yearly reduction of GDP. There are large differences between the estimates. One of the reasons for pursuing such studies is to give improved basis for more cost-effective post-conflict reconstruction, which is better achieved with an accounting method.</p><p>“War and Economic Performance – Different Data, Different Conclusions?” This article studies the importance of armed conflict for economic growth by replicating an earlier analysis with new data on conflicts. The basic model investigates how conflicts in 1960-1974 affect economic growth in 1975-1989. Koubi finds that “wars are conducive to higher growth”. Koubi’s finding is confirmed when different conflict data is used in a similar research design.</p><p>“The Role of External Factors in Economic Growth: A Comparative Analysis of Thailand and the Philippines 1950-1990”. Can differences in economic performance be explained by external factors? Both historical and regression analyses are utilised to answer the question. Three external factors are analysed: <i>International trade, foreign direct investment</i>, and <i>external debt</i>. In the regression analysis none of the external factors qualify as statistically significant. The historical analysis finds two external factors discriminating between the two countries. Thus, they might explain the differing growth rates of Thailand and the Philippines: Manufactured exports and external debt.</p>

“Armaments and Economic Performance”. The literature on military expenditure (milex) is scrutinized with respect to five areas. Investment is reduced when milex increases. Most studies have found economic growth hindered by higher milex. No clear association between milex and employment is found. However, the same amount of other public expenditure creates more jobs. There is some evidence for milex as counter-cyclical instrument in the US. The result for studies if milex is used in electoral cycles in the US is contradictory. Disaggregated data are emphasized as a possible solution to get more definite results. “The Economic Costs of Civil Wars”. The empirical studies of the economic costs of internal armed conflicts are divided into accounting and modelling methods. Cost is seen as the difference between the counterfactual production without conflict and the actual production. The average economic cost of internal armed conflict is a 3.7% yearly reduction of GDP. There are large differences between the estimates. One of the reasons for pursuing such studies is to give improved basis for more cost-effective post-conflict reconstruction, which is better achieved with an accounting method. “War and Economic Performance – Different Data, Different Conclusions?” This article studies the importance of armed conflict for economic growth by replicating an earlier analysis with new data on conflicts. The basic model investigates how conflicts in 1960-1974 affect economic growth in 1975-1989. Koubi finds that “wars are conducive to higher growth”. Koubi’s finding is confirmed when different conflict data is used in a similar research design. “The Role of External Factors in Economic Growth: A Comparative Analysis of Thailand and the Philippines 1950-1990”. Can differences in economic performance be explained by external factors? Both historical and regression analyses are utilised to answer the question. Three external factors are analysed: International trade, foreign direct investment, and external debt. In the regression analysis none of the external factors qualify as statistically significant. The historical analysis finds two external factors discriminating between the two countries. Thus, they might explain the differing growth rates of Thailand and the Philippines: Manufactured exports and external debt.