Defense Spending and Export in South Korea: A Causal Analysis

Since the mid-1970s the Gulf economies have experienced an unprecedented growth in economic output and industrial production. The benefits of rapid increases in oil revenues were also distributed to neighboring countries through financial assistance, expanded trade, and jobs for skilled and unskilled workers. Concurrent with rapid economic growth was an acceleration in regional military spending. Military purchases were partially financed by oil revenues and by military aid and grants from the major arms suppliers.' Dur-ing this pe,riod, 'military expenditures have averaged around 30 per cent of central government expenditures. This compares with ,an average of around 20 per cent for most developing countries. Military expenditure per capita averaged around $500, while the average for developing countries as a whole was about $50. While the armed forces per 1,000 people averaged around 15 for the Middle East, developing countries, as a whole, experienced rates of only five per 1,000 people.2 Ironically, this increase in military expenditures coincided with rates of rapid growth throughout the Middle East. During the 1973-82 oil boom period the average annual economic growth rate in the Middle East was about 6.0 per cent while military expenditures grew by approximately 13.0 per cent per year. Although military expenditure levels vary across countries, in most of the countries the growth rate of military spending outpaced economic growth and, perhaps, even expenditures for economic development.3 This indicates a striking pattern in the region toward higher military burdens.' To date most of the analysis concerning Middle Eastern military expenditure has focused on strategic issues and the resulting shifts in regional military balance stemming from the recent explosion in defense expenditures. Most recently, analysts have begun examining the likely composition and extent of military sales to the region following the successful resolution of the Kuwaiti crisis. Those studies examining the economic effects from defense expenditure,s have focused largely on the identification of linkages between defense expenditures and overall economic growth. These studies have provided some insight about the shorter term economic costs (and

The study aims to examine the dynamic relationships (links) between monthly defense spending (in current prices) and inflation in Russia over the period (2011–2023), based on wavelet coherent analysis, which allows us to identify correlations and the links direction between the analyzed variables that change over time. The research states that over short time scales (1–20) months, throughout the entire observation period, there are frequent (over 10 times) changes in modes, with different cause-and-effect relationships between defense spending and inflation. However, the most frequent mode is the one in which changes in variables are consistent in phase, but defense spending outpaces inflation and the growth of defense spending contributes to the inflation expansion (a positive correlation between defense spending and inflation). Over longer time scales (60–156) months, only two modes have been formed, with the first mode showing variables that are phase-aligned, but inflation outpacing defense spending and inflation growth contributing to defense expenditures growth (the direction of the positive causal links is from inflation to defense spending), is then transitioning to a mode in which the variables change in anti-phase and in which defense expenditures outpaces inflation, and the growth of defense spending suppresses the growth of inflation (a negative correlation between defense spending and inflation). This shows no inflationary consequences for Russia’s defense spending under this regime. As a result , the authors conclude that complex of intricate, multi-scale economic links between Russia’s defense expenditures and inflation exist across different investment timeframes. The study’s practical importance lies in its identification of the temporal and qualitative aspects of the nonlinear interplay between defense spending and inflation in Russia, alongside the conclusion that escalating defense spending doesn’t negatively affect the macroeconomic inflation indicator over extended periods.

TT IS widely believed among scholars that defense spending in A-merica is excessively high and has gained an undue influence in setting national priorities which adversely affect our welfare programs. Some writers maintain defense expenditures are excessive because our defense effort has required a reduction in more desirable social welfare programs.' Others argue that in recent years our military system has become economically non-productive and causes stagnation and therefore rising welfare costs in the civilian sector.2 Still others believe that excessive and wasteful defense expenditures are deliberately planned and necessary for a capitalist system to survive.3 Finally, a substantial number of analysts simply believe that the fear of an external threat upon which defense budgets are based is grossly exaggerated, and, conversely, that welfare needs have been underestimated. Both our pacifistic and Judaeo-Christian t-raditions support this position. Those who argue for these propositions usually do so on the basis of a single and quite broad definition of defense spending and a fairly narrow definition of welfare spending. Moreover, the basis of funding is almost always limited to the federal budget. This method, of course, includes virtually all defense-related expenditures, but excludes much of the thrust of state and local welfare-related programs which have been rising almost as fast as federal outlays. These studies also focus on recent years and do not examine long-term trends in either defense or welfare spending. This essay will attempt to expand the number of working definitions of both defense and welfare spending, and compare the spending patterns derived by those different methods since these data first became available. In addition, a method of measurement common to both welfare and defense spending will be developed for purposes of better comparison. It is hoped that, by using a variety of definitions and methods of measurement and a more extensive longitudinal focus, the reader may gain a much more comprehensive picture of the interrelationship between defense spending and welfare spending in the United States and thereby be better able to determine whether either or both are excessive. Finally, I shall argue that our rapidly rising social welfare expenditure trends are far more unsettling than our shrinking defense commitments.

This paper analyzes the economic impacts that would result from a reduction in defence spending. Simulations using publicly available models are used for this analysis, which includes an examination of alternative means of reducing Department of Defense expenditures. Both the macroeconomic and industrial impacts of defence reductions are described.

This paper examines the relationship between defence burden and real gross domestic products in Nigeria, using annual time series data. This study uses Johansen’s Cointegration approach to investigate the relationship between government’s military expenditure (defence burden) and real gross domestic products, among other variables. In light of the lingering controversy on military expenditure and growth nexus, this paper contributes to the existing literature using time-series data from Nigeria, a country with high military spending over the years to re-investigate the impact of military expenditures on economic growth and the direction of causality between military spending and economic growth. Specifically, this study discusses the long run relationship between military expenditure and economic growth using Johansen cointegration approach. The key variables used in the study include: military burden (military expenditure), real GDP, real education expenditure, real health expenditure. The nature of the relationship that exists between military expenditure and economic growth as well as the cointegrating vector, taking into cognizance all other variables is focus of this paper. The results of the study show that increased defence burden is harmful to the Nigerian economy, and there exists a negative long-run relationship between defence burden and increase in the growth of real gross domestic products, the impact of defence burden remains negative both in the short-run and long-run respectively. It is not sufficient to have cuts in military expenditure, but such reallocation from defence should be directed towards productive investment in other sectors of the economy in order to generate economic prosperity and enhance the welfare of the citizens. Implications of having a negative effect of defence burden on growth rate of real Gross Domestic Products result in crowding-out of private sector investment, retards economic progress or growth rate of real gross domestic products, and therefore, is an ineffective tool to stimulate the growth of the economy in Nigeria. Military expenditure cannot be an effective tool of fiscal policy (government revenue and expenditure to regulate the economy), from the results of the study both short-run and long-run impact are negative, hence, the role of military sector should be limited to the maintenance of internal law and order as well as the defence of the country against any form of external aggression. This study will be of immense significance towards shaping policies that relate to military spending in Nigeria.

This paper examines the causal relationship between renewable energy consumption and economic growth in South Korea using a framework of the conventional neo-classical production function of capital, labor, and renewable energy. We use cointegration technique of the autoregressive distributed lag bounds test and vector error correction mechanism causality tests to determine the econometric relationship, using data for the period 1990–2012; the results support the conservation hypothesis for South Korea. The results of the autoregressive distributed lag bounds test show that renewable energy consumption has a negative effect on economic growth, and the results of a vector error correction mechanism causality tests indicate a unidirectional relationship from economic growth to renewable energy consumption. The empirical results imply that economic growth is a direct driver expanding renewable energy use. In terms of policy implications, it is best for policy makers to focus on overall economic growth rather than expanding renewable energy to drive economic growth.

This study examines the causal nexus between defense expenditure and economic growth in China using the bootstrap Granger full-sample causality test and rolling-window estimation. The full-sample result indicates a positive bidirectional causality between economic growth and defense expenditure, suggesting that more defense spending increases economic growth, and vice versa. By adopting a time-varying rolling-window approach to revisit the dynamic causal relationships, this article identifies that the causality changes over time. We find significant positive short-run causality running from economic growth to defense expenditure in most of the time investigated, thus implying that economic growth stimulates defense expenditure. However, large-scale disarmaments break such positive linkage. Conversely, both positive and negative effects of defense expenditure on economic growth are demonstrated, showing that more defense spending has ambiguous effect on economy. Consequently, economic growth mainly drives defense expenditure rather than the other way around. The impact of defense expenditure in China on national economy is affected by multiplier effect and crowding-out effect as well as institutional factors.

Purpose – The purpose of the article is to compare the macroeconomic effects of military and non-military government spending on the Polish economy, which is particularly relevant in the context of the rapid rise in military spending after the outbreak of the war in Ukraine. Research method – The research is based on a new-Keynesian dynamic stochastic general equilibrium model estimated for the Polish economy. The model developed for the study takes into account differences between 3 types of government spending – military spending, non-military current spending and non-military investment. Results – On the one hand, the empirical results show that in the short and medium term, increasing military spending is a more effective method of stimulating GDP than rising non-military spending. On the other hand, the impulse response functions indicate that increasing non-military spending is a better tool for enhancing effective consumption. Originality / value / implications / recommendations – This is the first research exploring the macroeconomic effects of military spending in a CEE country, which is based on stochastic general equilibrium model accounting for heterogeneity of government spending. Assessing these effects at a time of unprecedented growth in military spending in Poland is an important added value of the study. The main implication of the research is to recommend increasing military spending to boost GDP, while rising non-military spending to stimulate effective consumption.

This study revisits the causal linkages between military spending and economic growth in China and G7 countries (i.e. Canada, France, Germany, Italy, Japan, the UK, and the USA) by focusing country-specific analysis for the period 1988–2010. The panel causality analysis, which accounts for both cross-country dependency and heterogeneity across countries, is employed in this study. Our results find evidence of the neutrality hypothesis for Italy, France, and Germany, the military spending–growth detriment hypothesis for both Canada and the UK, and one-way Granger causality running from economic growth to military spending for China. Furthermore, we find a feedback between military spending and economic growth in both Japan and the USA. Thus, our results do not support that one size fits all.

This study examines the relationship between government spending, specifically military spending, government spending on health, government spending on education, and economic growth in Egypt over the period from 1980 to 2021. The paper utilizes a Granger causality test to detect the directional relationship between spending components and GDP growth. Furthermore, an autoregressive distributed lag (ARDL) model, including error-correction models, was established to determine the long- and short-term relationships among these variables. The study contrasts Wagner’s versus Keynes’s views of the government spending relationship with economic growth, with a greater emphasis on Keynes’s argument for military spending enhancing economic growth. While previous studies have investigated the relationship between aggregate spending and economic growth from a single or two-way direction of causality, the present study contributes to the literature by exploring the possibility of military spending crowding out spending on health and education and detecting this causality and dynamic relationship. The empirical results support the Keynesian view of causality from all government spending components to economic growth. However, short- and long-term analyses revealed a negative relationship between military spending and economic growth. Moreover, the short-term impact of government spending on education and health on economic growth is negative, but positive in the long-term. Finally, the causality test revealed that military spending influences health and education spending. Additionally, a unidirectional relationship exists between military spending and health expenditure, which requires further research. The policy implication of this study shows that although spending is exogenous to economic growth, it does not align with the Keynesian view of inducing growth. Instead, spending has negative current and future implications for economic development.

The character of the British defence industry since the 1940s has reflected a regime of accumulation which was shaped by both Fordism and the War. The decline of both these influences means that the political economy of defence spending and the internal organization of the defence industry are changing. While the outbreak of peace in Europe should lead to some reduction in defence spending on Cold War items, the world's arms industry is not about to disappear. The global arms industry remains huge and is increasing beyond the control of individual national governments. The concentration of capital and intensified search for markets is likely to increase the volatility of the industry, and affect individual companies and nations with varying results. Britain may remain disproportionately important in the new military economy. Copyright 1990 by Oxford University Press.

This paper introduces for discussion the need and opportunities for shipyards to diversify into new areas of business. The need for diversification results from reductions in defense spending and the difficulties U.S. shipbuilders are having in gaining new orders. Shipyards have unique abilities that can be competitive strengths in other markets. Among these strengths are the ability to handle large, complex projects, the range of skills among their workforce, and their proximity to water transportation facilities. Examples of shipyard participation in new markets demonstrates these strengths. Other markets addressed in this paper serve the utility and process industries, and the opportunities to participate in energy resource research and development.

In his farewell address on January 17, 1961 outgoing President Eisenhower coined the now well worn phrase “military industrial complex” in his warning that there is a danger in the confluence of the government’s military establishment and a growing industrial based serving those interests. Specifically, he cautioned that “(i)n the councils of government, we must guard against the acquisition of unwarranted influence, whether sought or unsought, by the military industrial complex. The potential for the disastrous rise of misplaced power exists and will persist (Eisenhower 1961).” These warnings, as we all know, have gone unheeded and at present estimates direct spending by the US Department of Defense will reach almost $664 billion (OMB 2009, Table S.12) while combined defense related expenditures from all sources including debt service has been over a $1 trillion since 2007 (Higgs 2007). Considering this outlay has only risen since 2007 and the current budget expenditures for 2010 estimated at just under $3.6 trillion (OMB 2009, Table S.1) we can say the military industrial complex feeds on almost $0.30 out of every dollar spent by the US government. Few readers of this journal would doubt that Eisenhower’s concern over the existence of misplaced power accompanied by unwarranted influence was overstated. While some domestic social benefits of military-inspired production can be identified in new materials developed, innovative consumer products available, and the like, it is equally obvious that once such a behemoth is set in motion weaning the political economy from defense related spending is nigh impossible. What district or region of the US does not feed to some degree at that public trough, what Representative or Senator will advocate for a reduction in defense spending if it means his or her district will lose Federal dollars, local tax revenues, jobs and more? One need only look to the political struggle in the 1990s surrounding the attempt to identify and then close underutilized and unnecessary military bases around the country to see the scope of the challenge. In the end, the urgency of building a defense apparatus during the Cold War in the post World War II era of confrontation blinded almost everyone to the dangers so clearly outlined by Eisenhower above. A real danger, aside from the incredible drain on the national weal, is that once Critical Sociology 36(4) 483-487

BackgroundScabies is a common contagious skin disease. With the economic growth in South Korea, the incidence of scabies has decreased. However, with the recent advancements in medical facilities, mainly the establishment of long-term care hospitals (LTCHs), scabies is now considered an emerging public health problem.Methodology/Principal findingsTo examine the prevalence and management of scabies in LTCHs in South Korea, we contacted all 1,336 LTCHs registered at the Health Insurance Review and Assessment Service in South Korea in 2018. A total of 110 LTCHs completed a questionnaire, and we analyzed their responses. In the last 5 years, 71.8% (79/110) of LTCHs had a high incidence of scabies (suspected/confirmed cases). Usually, patients aged older than 80 years (45.5%) were diagnosed with the disease, with more women being affected than men. Only 30.0% of the patients were transferred to scabies-restricted rooms, and very few LTCHs (7.0%) had special departments for scabies. Fifty-five (61.1%) of 90 LTCHs reported contact between scabies patients and nurses, nurse aides, caregivers, and other employees (hereinafter, referred to as primary exposure), with 29 (32.2%) LTCHs reporting infections due to primary exposure. The most common challenges in managing scabies were patient isolation (47.8%), diagnosis (31.1%), management of individuals exposed to an individual with scabies (17.8%), lack of staff for managing the patients (16.7%), and treatment (11.1%).ConclusionsThe incidence rate of scabies in LTCHs in South Korea has increased. Regular and enhanced staff training is needed, considering that most hospitals rarely focused on the handling of equipment and furniture used by scabies patients and on educating their healthcare staff. These findings can be used to develop various strategies to reduce the prevalence of scabies.

<p>This study investigates the relationship between external debt and military spending in case of India over the period of 1970–2012. In doing so, we have applied the structural break unit root tests to examine stationarity properties of the variables. The Auto-Regressive Distributed Lag (ARDL) bounds testing approach is used to test whether cointegration exists in presence of structural breaks stemming in the series. Our results indicate the cointegration among external debt, military spending, debt servicing, and economic growth. Moreover, military spending and debt servicing add in external debt. Economic growth helps in lowering external debt. The Vector Error Correction Model (VECM) analysis and Granger causality test reveal that military spending and economic growth cause external debt. The feedback effect also exists between external debt and debt servicing in case of India.</p>