Suzanna-Maria Paleologou

A PANEL DATA ANALYSIS OF THE NEXUS BETWEEN DEFENCE SPENDING AND GROWTH IN THE EUROPEAN UNION

The nexus between economic growth and military expenditure has attracted considerable attention and has been the subject of extensive theoretical and empirical work. Given the move towards the development of a Common European Security and Defence Policy (CESDP), this paper, using panel data analysis, addresses the causal ordering issue between growth and defence spending in the case of the European Union (EU15). Results reported herein suggest the presence of a positive feedback between growth and military expenditure in the long run and a positive impact of the latter on growth in the short run.

Growth, investment and military expenditure in the European Union‐15

Purpose – The purpose of this paper is to investigate the relationship between growth, investment and military expenditure in the case of the European Union‐15.Design/methodology/approach – The paper uses fixed panel models, random coefficient models and a trivariate VAR model to examine empirically the relationship between these three macroeconomic variables.Findings – The results obtained and reported herein show a significant positive effect of the growth rate on the share of military expenditure and on the share of investment. However, on the whole, the findings do not seem to point to any consistent quantitative relation between defence spending and either growth or investment. Thus, they appear to be in line with the findings of other studies.Originality/value – The economic effects of military spending have drawn considerable attention. Demand side effects on capacity utilisation are one possible channel through which the economy can be positively affected by such expenditure. On the other hand how...

A DYNAMIC PANEL DATA MODEL FOR ANALYZING THE RELATIONSHIP BETWEEN MILITARY EXPENDITURE AND GOVERNMENT DEBT IN THE EU

This paper examines the impact of military spending on general government debt in the enlarged European Union (EU) countries. For this purpose, we use panel data analysis and provide estimates from a dynamic Generalized Method of Moments (GMM) panel model. The dynamics are found to be important and the results suggest that military expenditures do have a large positive impact on the share of general government debt in the EU.

Modelling the demand for national security expenditure: a note

In the past, national security for the majority of countries was almost exclusively associated with an external military threat emanating from a rival state(s). This was reflected in the standard models for the demand for military expenditure. The emergence of new security challenges such as terrorism, transnational crime networks, failed and rogue states, has profoundly affected the international security environment and the concept of national security. This note develops a model for the demand for national security expenditure adopting a broader, more inclusive definition of national security and includes concomitant budgetary outlets to meet the new security challenges.

Labour market conditions and crime in Greece

Purpose - The purpose of this paper is to examine the impact of unemployment on various types of crime in Greece. Design/methodology/approach - A battery of econometric tests, including Granger causality tests, a variance decomposition analysis, and an impulse response analysis are used to explore the nexus between unemployment and 14 different types of crime. Findings - Out of the 14 different types of criminal activity, only in the case of three – vehicle thefts, robberies and contraband & smuggling – was a nexus with unemployment established. Practical implications - Given that such criminal activity is primarily motivated and driven by economic gain, a policy implication is that crime thwarting policies need to be complemented by corresponding labour market interventions, especially in periods of recession, when unemployment emerges as a major problem for disadvantaged social groups. Originality/value - The issue between labour market conditions and crime has not been addressed before in the case of Greece, a country that has experienced a generally growing crime rate.