Determinants of Components of Military Spending

31 Pages Posted: 4 Nov 2024

See all articles by Jordan Becker

Jordan Becker

United States Military Academy, Department of Social Science; Free University of Brussels (VUB)-Vrije Universiteit Brussel, Institute for European Studies, Students; Chaire ECODEF - IHEDN; Institut de Recherche Stratégique de l’Ecole Militaire (IRSEM - Institute for Strategic Research)

J. Paul Dunne

Independent

Date Written: September 22, 2024

Abstract

What drives demand for defence spending and, especially, different types of defence spending? While a large body of literature addresses the determinants of countries' defence spending, only recently have scholars begun analysing the determinants of disaggregated defence budgets, focusing on four components: equipment, personnel, infrastructure, and operating & maintenance (O&M). Using a purpose-built, unbalanced panel dataset disaggregating defence expenditures of 35 countries for between 10 and 67 years, we find that there is significant heterogeneity in the drivers of demand for defence expenditure, not just across countries and over time, but among the four categories of spending. These differences among categories have significant policy implications for the countries studied, as European countries seek to recapitalize their militaries and reconstitute stocks of munitions depleted by the Russo-Ukrainian war. Specifically, we find that equipment and O&M spending are the primary drivers of the canonical public choice hypothesis that wealthier countries spend more on defence. This has critical policy implications for Western support for Ukraine in what has become an attritional conflict, as equipment spending captures investment in major end items like vehicles and weapon systems, while O&M spending supports the acquisition and replenishment of munitions.

Suggested Citation

Becker, Jordan and Paul Dunne, J., Determinants of Components of Military Spending (September 22, 2024). Available at SSRN: https://ssrn.com/abstract=4964245 or http://dx.doi.org/10.2139/ssrn.4964245

Jordan Becker (Contact Author)

United States Military Academy, Department of Social Science ( email )

600 Thayer Rd
West Point, NY 10996
United States

Free University of Brussels (VUB)-Vrije Universiteit Brussel, Institute for European Studies, Students ( email )

Ixelles
Belgium

Chaire ECODEF - IHEDN ( email )

Institut de Recherche Stratégique de l’Ecole Militaire (IRSEM - Institute for Strategic Research) ( email )

École Militaire - case 38
1, place Joffre
Paris SP 07, 75007
France

J. Paul Dunne

Independent ( email )

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