Arbeitspapier
Does Development Aid Increase Military Expenditure?
Using a new instrumental variable strategy, we examine whether bilateral development aid increases military expenditure in recipient countries. The instrument is the interaction of donor government fractionalization and the probability of receiving aid. The dataset includes new data on military expenditure for 124 recipient countries over the 1975–2012 period. When accounting for outliers, our results do not suggest that development aid affects military expenditure in the full sample. However, the effect of aid on military expenditure varies across characteristics of recipient and donor countries, even after excluding outliers. First, aid increases military expenditure in countries that depend on aid and are prone to conflicts. Second, aid provided by coordinated market economies increases military expenditure.
- Sprache
-
Englisch
- Erschienen in
-
Series: ifo Working Paper ; No. 303
- Klassifikation
-
Wirtschaft
Foreign Aid
National Security and War
Macroeconomic Analyses of Economic Development
- Thema
-
Aid
fungibility
military expenditure
instrumental variables
causality
- Ereignis
-
Geistige Schöpfung
- (wer)
-
Langlotz, Sarah
Potrafke, Niklas
- Ereignis
-
Veröffentlichung
- (wer)
-
ifo Institute - Leibniz Institute for Economic Research at the University of Munich
- (wo)
-
Munich
- (wann)
-
2019
- Handle
- Letzte Aktualisierung
-
10.03.2025, 11:45 MEZ
Datenpartner
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. Bei Fragen zum Objekt wenden Sie sich bitte an den Datenpartner.
Objekttyp
- Arbeitspapier
Beteiligte
- Langlotz, Sarah
- Potrafke, Niklas
- ifo Institute - Leibniz Institute for Economic Research at the University of Munich
Entstanden
- 2019
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