Relationships Between Defence Expenditures and Economic Growth in G7 Countries: Panel Bootstrap Causality Analysis

Year 2021, Volume: 5 Issue: 1, 119 - 140, 23.08.2021

Şerif Canbay , Mustafa Kırca , Erkan Oflaz

https://doi.org/10.33399/biibfad.826216

Cited By: 1

Abstract

It is important to reveal the relationship between defence expenditures and economic growth for both developed countries and developing countries. Dynamic political and economic developments affect defence expenditures. Many macroeconomic variables of countries are affected by the change in defence expenditures. Economic growth comes first among these macroeconomic variables. This study aims to determine the relationships between the economic growth and defense expenditures of the G7 countries for the period 1988-2018. For this purpose, the relationships between variables were examined using bootstrap panel causality analysis developed by Kónya (2006). According to the analysis results, it was found that there is a unidirectional causality relationship from defense expenditures to economic growth in the USA, Germany, Japan, England, and Canada. The sign of causality relationships is negative in the USA, UK, and Canada, and positive in Germany and Japan. On the other hand, in the findings of the study, an insignificant causality relationship was found between variables in France and Italy. Besides, for the G7 countries, an insignificant causality relationship has been determined from economic growth to defense expenditures. Economic and political inferences were made based on the findings obtained at the end of the study.

Keywords

Defence spending, G7 countries, per capita income, economic growth, bootstrap panel causality

Relationships Between Defence Expenditures and Economic Growth in G7 Countries: Panel Bootstrap Causality Analysis

Abstract

Savunma harcamaları ile iktisadi büyüme arasındaki ilişkilerin ortaya konulması hem gelişmiş ülkeler hem de gelişmekte olan ülkeler için önem arz etmektedir. Dinamik siyasi ve iktisadi gelişmeler savunma harcamalarını etkilemektedir. Savunma harcamalarının değişmesiyle birlikte ülkelerin birçok makroiktisadi değişkenleri de etkilenmektedir. Bu makroiktisadi değişkenlerin başında iktisadi büyüme gelmektedir. Bu kapsamda çalışmanın amacı G7 ülkelerine ait 1988-2018 dönemine ait savunma harcamaları ile iktisadi büyüme arasındaki ilişkileri tespit etmektir. Bu amaç doğrultusunda değişkenler arasındaki ilişkiler Kónya (2006) tarafından geliştirilmiş bootstrap panel nedensellik analizi yardımıyla incelenmiştir. Analiz sonuçlarına göre ABD, Almanya, Japonya, İngiltere, Kanada’da savunma harcamalarından iktisadi büyümeye doğru tek yönlü bir nedensellik ilişkisi olduğu bulgusuna ulaşılmıştır. Nedensellik ilişkilerinin işareti ABD, İngiltere ve Kanada’da negatif, Almanya ve Japonya’da pozitiftir. Diğer taraftan çalışmanın bulgularında Fransa ve İtalya’da değişkenler arasında istatistiki olarak herhangi bir nedensellik ilişkisi tespit edilememiştir. Ayrıca G7 ülkeleri için iktisadi büyümeden savunma harcamalarına doğru istatistiki olarak herhangi bir nedensellik ilişkisi saptanmamıştır. Çalışmanın sonunda elde edilen bulgulara dayanarak iktisadi ve politik çıkarımlar yapılmıştır. 

Keywords

Savunma harcamaları, G7 ülkeleri, kişi başına düşen milli gelir, iktisadi büyüme, bootstrap panel nedensellik, G7 ülkeleri

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