The Relationship Between Defense Expenditures and Economic Performance in Selected Countries

Abstract

Abstract There is no consensus on the impact on growth of military expenditures, which are included under the state expenditures planned by policy decision-makers, since they have different characteristics from the rest of the state expenditures. Military expenditures made in order to provide support for issues such as protecting the welfare of society, protecting the country's borders, defending against attacks from outside, protecting energy fields in order for economic growth to take place are being increased by countries day by day. Considering that dec jul is directly proportional to growth, countries are spending on production and R & D by providing the necessary infrastructure for the defense industry. Countries that have achieved a rapid technological acceleration from an industrial point of view ensure the security of their own nation, which is one of the social state requirements, protect their borders, and minimize their costs and external dependence. Countries can follow independent policies in case of possible threats with technological advances. This study aims to examine the worldwide history of the defense dec and the relationship between military expenditures for the defense industry and economic performance in selected countries by conducting a panel data analysis. In the analysis, Turkey, Azerbaijan and Pakistan, which are in close social, cultural and economic relations, were included in the analysis and the period 1992-2019, when there were no difficulties in providing data, was considered. The growth rates in real gross domestic product per capita as an indicator of economic performance, while using military spending as an indicator of the share of military expenditure in gross domestic product was used. As a result of the analysis, it was concluded that an increase in military spending has a negative impact on economic growth. It can be said that military expenditures have a negative impact on growth in the relevant countries due to the fact that they are carried out instead of efficient investment expenditures.

Keywords

• Military Expenditures
• Economic Performance
• Granger Causality Test
• Panel Data

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