Munich Personal RePEc Archive

Military competition and size and composition of economy and government

Teng, Jimmy (2012): Military competition and size and composition of economy and government.

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Abstract

This paper uses a formal model to analyze the effects of military competition between states on the size and composition of the economy and the government. Great economies of scale in warfare and even distributions of military capability among the contestants generate intense interstate rivalry, strong concern for relative economic and military capability. Consequently, there is a larger economy and government and an increasing share of the military in the economy. However, if there are diseconomies of scale in the provision of public intermediate inputs, intense military competition between states actually increases the relative size of the civilian public sector relative to that of the military. The paper then studies how waves of military technological revolutions affected military competition between states and the size and composition of economy and government in history.

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