Military spending, technical progress, and economic growth: a critical overview on mainstream defense economics

Abstract

The present article will exclusively focus on the macro-dynamic branches of defense economics, appeared in the 1970 after the seminal contributions by Benoit (1972, 1973) – leaving apart other fields, such as game theory, input-output approaches or industrial economics. Its main objective, and originality, is to show that the mainstream literature – or methodologies closely related to it – devoted to the effects of military spending stumbles over worrying difficulties, by throwing light on its unsuperable limitations from both an empirical and a theoretical point of view. Our criticism will successively apply to demand-side and supply-side models (first part); for- malizations with technological spin- off effects, externalities or public goods (second part); and simulation models, including the most recent ones with endogenous technical progress growth models (third part).