Munich Personal RePEc Archive

Do Military Expenditures Boost Profit Rates?

Elveren, Adem Yavuz and Dunning, Rachel (2017): Do Military Expenditures Boost Profit Rates?


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Understanding the effect of military expenditures on profit rates can provide important insights on the use of government spending. We utilize the panel dynamic ordinary least square method to examine that relationship for 32 major countries from the period of 1963-2008. We find that while military expenditures increase profit rates in arm-exporting countries, the opposite occurs in the case of arms-importing countries.

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