The demand for defense spending in Russia: Economic and strategic determinants

Abstract

The allocation of resources to defense and national security is influenced by several factors, both domestic and external. Findings, reported in the relevant empirical literature, suggest that military spending is determined by a cohort of economic, strategic and political factors. This paper estimates a demand function for Russian military expenditure for the period 1992-2015. The results indicate that Russian defense spending is strongly dependent on income from energy exports as well as on the overall performance of the Russian economy. Strategic factors also emerge as significant determinants of such expenditure.