Author: N. Dritsakis
Publisher/Publication: Journal of Policy Modeling
Volume/Issue: 26 (2)
DOI/ISBN: 10.1016/j.jpolmod.2004.03.011
Abstract: The author in this paper investigates the relationship between defense spending and economic growth for Greece and Turkey. The empirical analysis of this paper applies the Johansen cointegration test and suggests that there is no cointegrated relationship between the two variables, while the Granger causality results indicate a unidirectional causal relationship between economic growth and defense spending for both countries. Moreover, they indicate that there is a bilateral causal relationship between defenses spending of the two countries. Part of the econometric school of study of the post-1945 Greek-Turkish military expenditure and possible arms racing.