The Effect of Military Expenditures on Stock Exchange Indices: A Research on G8 Countries and Turkey

Abstract

Aim: The aim of this study is to analyze the impact of military expenditures on stock market indices. In this context, the study seeks to determine the effect of military expenditures on equity markets using a sample comprising G8 countries (United States, Russia, the United Kingdom, Germany, France, Japan, Italy, and Canada) and Turkey. Method: In the study, panel data analysis was conducted using a dataset covering the period from 2006 to 2022. The stock market index was used as the dependent variable, while the independent variables included military expenditures, energy consumption, portfolio investments, inflation, and GDP. Results: The analysis results indicate a positive and statistically significant relationship between military expenditures and stock market indices in the model constructed for the G8 countries and Turkey. An increase in military expenditures generally has a favorable impact on equity markets. However, when assessed on a country-specific basis, a statistically significant negative effect was identified for the United States and Turkey, while a statistically significant positive effect was observed for Italy. Conclusion: The findings support the impact of military expenditures on financial markets. While the overall model reveals a positive and statistically significant effect of military expenditures on stock market indices, country-specific variations have been observed. An increase in military expenditures was found to have a negative impact on stock market indices in the United States and Turkey, whereas a positive and statistically significant effect was identified for Italy. These differences can be attributed to factors such as the economic structures of the countries, investor perceptions, and geopolitical risk factors.

Keywords

• Military Expenditure
• Stock Exchange
• Index
• G8
• Turkey

Askeri Harcamaların Borsa Endeksleri Üzerine Etkisi: G8 Ülkeleri ve Türkiye Üzerine Bir Araştırma

Abstract

Amaç: Bu çalışmanın amacı, askeri harcamaların borsa endeksleri üzerindeki etkisini analiz etmektir. Bu kapsamda G8 ülkeleri (Amerika Birleşik Devletleri, Rusya, İngiltere, Almanya, Fransa, Japonya, İtalya ve Kanada) ve Türkiye örnekleminde, askeri harcamaların hisse senedi piyasalarına olan etkisinin tespit edilmesi hedeflenmiştir. Yöntem: Çalışmada 2006-2022 yıllarını kapsayan veri seti dikkate alınarak panel veri analizi gerçekleştirilmiştir. Bağımlı değişken olarak borsa endeksi yer alınırken, bağımsız değişkenler arasında askeri harcamalar, enerji tüketimi, portföy yatırımları, enflasyon ve GSYİH yer almaktadır. Bulgular: Analiz sonuçları, G8 ülkeleri ve Türkiye için oluşturulan modelde askeri harcamalar ile borsa endeksleri arasında pozitif ve istatistiksel olarak anlamlı bir ilişki olduğunu göstermektedir. Askeri harcamalardaki artış, genel olarak hisse senedi piyasalarında olumlu bir etki yaratmaktadır. Ancak ülke bazında değerlendirme yapıldığında, Amerika Birleşik Devletleri ile Türkiye için negatif etkinin ve İtalya için pozitif etkinin istatistiksel olarak anlamlı olduğu tespit edilmiştir. Sonuç: Elde edilen bulgular, askeri harcamaların finansal piyasalar üzerindeki etkisini destekler niteliktedir. Genel modelde askeri harcamaların borsa endeksleri üzerinde pozitif ve istatistiksel olarak anlamlı bir etkisi bulunmasına rağmen, ülke bazında farklılıklar gözlemlenmiştir. Amerika Birleşik Devletleri ve Türkiye için askeri harcamalardaki artışın borsa endeksleri üzerinde negatif bir etkisi olduğu tespit edilirken, İtalya için bu etkinin pozitif ve istatistiksel olarak anlamlı olduğu belirlenmiştir. Bu farklılıklar, ülkelerin ekonomik yapıları, yatırımcı algıları ve jeopolitik risk faktörleri ile açıklanabilir.

Keywords

• Askeri Harcama
• Borsa
• Endeks
• G8
• Türkiye

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