Effect of military expenditure on economic growth: evidences from India Pakistan and China using cointegration and causality analysis

Abstract

The study revisited the existing evidences of India Pakistan and China with updated data on the effect of military expenditure on economic growth. Econometric approaches analyzed the short and long run relationship between GDP growth and Military expenditure. Empirical studies have been done using cointegration analysis and causality test to justify the relationship and causality of the variables. Interestingly, study obtained positive log-run relation, no short run relationship and unidirectional long run causality in every cases, but for different degrees of relationship. Obtained results are robust and passed necessary diagnostic tests significantly.