Inequality in Military Expenditures and the Samuelson Rule

Defence and Peace Economics, Vol. 20, No. 1, pp. 43-67, 2009

Posted: 24 Sep 2009

See all articles by Loek F. M. Groot

Loek F. M. Groot

Utrecht University - School of Economics

Vincent A.C. van den Berg

VU University Amsterdam; Tinbergen Institute

Date Written: 2009

Abstract

In this paper, we show that standard measures used in the income inequality literature, the Lorenz curve and the associated Gini-index, can successfully be applied to the distribution of defence spending across countries. Secondly, we use the Samuelson rule to explain the distribution of military expenditures across countries over time. According to the constant defence burden interpretation of the Samuelson rule, corresponding to the diagonal in the Lorenz diagram, the defence burdens should be equal across countries. It is shown that about three quarters of the variation in military expenditures can be explained by the Samuelson rule. We then go beyond the Samuelson rule to see which countries spend much more or less than predicted and investigate which other factors may influence the defence burden.

Keywords: Public goods, Samuelson rule, Lorenz curve, Defence burden

Suggested Citation

Groot, Loek F. M. and van den Berg, Vincent A.C., Inequality in Military Expenditures and the Samuelson Rule (2009). Defence and Peace Economics, Vol. 20, No. 1, pp. 43-67, 2009, Available at SSRN: https://ssrn.com/abstract=1478044

Loek F. M. Groot (Contact Author)

Utrecht University - School of Economics ( email )

Kriekenpitplein 21-22
Adam Smith Building
Utrecht, 3584 EC
Netherlands

Vincent A.C. van den Berg

VU University Amsterdam ( email )

De Boelelaan 1105
Amsterdam, ND North Holland 1081 HV
Netherlands

HOME PAGE: http://www.feweb.vu.nl/nl/afdelingen-en-instituten/spatial-economics/staff/v-berg/index.asp

Tinbergen Institute ( email )

Gustav Mahlerplein 117
Amsterdam, 1082 MS
Netherlands

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