The Demand for Military Spending in the Peripheral Economies of
Europe
Paul Dunne
Middlesex University Business School
J.Dunne@mdx.ac.uk
Eftychia Nikolaidou
City Liberal Studies,
Affiliated College of the University of Sheffield, Thessaloniki
enikolaidou@city.academic.gr
Nikolaos Mylonidis
University of Ioannina
n.mylonidid@city.academic.gr
April 2002
Abstract:
Considerable research effort has been put into attempting to understand the factors that determine the
level of military expenditure or military burden in countries. The findings have led to suggestions
that the dynamics of the determinants of military spending will be best understood by case studies of
individual countries and studies of groups of relatively homogeneous countries. This paper
contributes to the literature by considering three of the EU’s peripheral economies - Greece, Portugal
and Spain. This article provides an analysis of the three countries’ experience, a particularly valuable
comparative study, given the importance of the military sector to the three countries during the
military governments (and the perceived Turkish threat for Greece), the quite marked reductions in
military spending after the end of the cold war and the availability of good time series data. A
detailed analysis of the trends in military spending and the changing structure of government
spending over the last forty years is undertaken. A simple model based on a general theory of the
demand for military spending, provides the basis for an investigation of the relative importance of
strategic and other social and economic factors and is found to perform surprisingly well.
Correspondence:
Dr. Eftychia Nikolaidou
City Liberal Studies,
Affiliated College of the University of Sheffield,
13, Tsimiski st.
546 24, Thessaloniki, Greece
Tel. +30310 224 186, 275 575,
Fax. +30310 287 564
e-mail: enikolaidou@city.academic.gr
26/07/16