The previous definition of militarization, as the expansion of military establishment in the society, shows that the concept is very wide. In what follows we will consider a specific aspect of militarization, which is the effect of military establishments. This includes the army during peace (its finance, weapons and equipment) and its effect during war (finance, destruction, etc).1
Military establishments in LDCs play a complex role in the development process, because of the prevailing high militarization levels, the rising trends of militarization indicators, and the continuous military intervention in economic and political activities. Military expenditure in these countries, and particularly in Africa, has increased rapidly in the last three decades. This has been accompanied by poor economic performance, poverty, deprivation, and escalating wars and conflicts. Thus, the relationship between military expenditure and development has become a relevant policy issue. The main aim of this section is to summarize the findings of the extant research on the economic impact of military expenditure, with special emphasis on Sub-Saharan Africa.
The economic impact of military expenditure in Third World countries has been relatively neglected in spite of a remarkable growth in studies dealing with its impact in advanced countries. However, in the last two decades the publication of data on military expenditure by some international organizations and the escalating trends of these expenditures in many LDCs have motivated a considerable number of empirical studies on the economic impact of military expenditure in LDCs. These studies can be classified into two broad categories. The first category consists of studies which follow a narrow approach emphasizing only the direct effects of military expenditure on economic growth. The second category consists of studies which follow a comprehensive approach, combining both the direct and the indirect effects of military spending on economic growth and other macroeconomic variables.1
Benoit's (1973,1978) pioneering study is one of the earliest studies in the first category. The study is widely cited in the literature (though much criticized), and a considerable number of studies have either modified Benoit's model or adopted the policy implications of his study. Benoit used correlation analysis to examine the effect of the defence burden on economic growth for a sample of 44 developing countries pertaining to the period 1950-1965. He found a strong positive correlation between high defence burdens and rapid rates of economic growth. Benoit then used multiple regression analysis to correct for the possibility that the result might be "technically spurious". In his regression analysis, economic growth did not emerge as a significant determinant of the defence burden: "what did appear
Figure 2
to be the main determinant of the size of the defense burden was the expectation of the political and military leaders of the need for forces to deter, to threaten, or to engage in combat"(Benoit, 1978: 275). Thus defence burden seemed to influence economic growth rather than vice versa.
In multiple regression analysis, Benoit added bilateral foreign aid and the investment rate to the defence burden in the economic growth equation. The results showed the defence burden had been a significant determinant of economic growth in the 1960-1965 period but not for the whole 1950-1965 period. However, he concluded that "it seems clear that in the sample countries higher defense burdens stimulate growth, at least to the extent of fully offsetting any adverse growth effects that defense expenditure may have had" [Benoit (1978; 276)].
Benoit has spelled out a number of channels through which military expenditures can induce economic growth. These include the provision of inputs to the civilian economy (e.g., housing, public works, education, medical care and technical spin-offs), besides the role of the military establishment as an important force for modernization and "nation building" in LDCs. He pointed also to inflation as a second link between defence and growth, as he presumed that the finance of heavy military burdens leads to the relaxation of strict monetary and fiscal policies which, in turn, leads to more inflation which pulls into economic use unused or underutilized resources which contribute to growth.
The advantage of Benoit's study is that it points to the channels through which the military burden can exert both positive and adverse impacts on the economy. However, his analysis suffers from specification, interpretation and methodological problems, most of which have unfortunately been inherited by the post-Benoit studies.
Nonetheless, many recent studies recognized both the importance of the study in pointing out some conduits through which defence can affect economic growth, and the need for some measures to correct for the limitations of Benoit's analysis. The studies which fall under what we called the "narrow" category have mainly relied on estimating single-equation models to quantify the effects of military spending (dependent variable) on economic growth (independent variable). Most of these studies, thus, captured only the direct effect of military expenditure on growth (For example, Alexander (1990). The second category of the studies of the economic impact of military expenditure have used simultaneous-equation models to estimate and separate both the direct and the indirect effects of military spending on macroeconomic variables (see, Smith and Smith (1980); and Mohammed (1992).
Most of the single-equation models have implicitly assumed that military spending is exogenously determined and that the relationship goes from military spending to economic growth. In contrast, Joerding (1986) used Granger-Causality to check this assumed exogeneity of military expenditure. The test results showed that military spending is not a strongly exogenous variable. He argued, therefore, that most of these studies were seriously flawed. "Consequently, further research into the relationship between economic growth and military spending should proceed by formulating and estimating dynamic or simultaneous-equation models of developing countries"(Joerding, 1986; 39).
The second "comprehensive" approach to the study of the economic impact of military expenditure has emphasized the importance of interdependence among defence, growth, and other economic variables, and the intermediate effects and feedbacks between defence and the other variables. It relies on estimating simultaneous-equation systems based on a well-specified theory. The simultaneous-equation systems separate and emphasize the various effects and concomitant feedbacks of military expenditure.
Apart from the defence-growth nexus in LDCs, a considerable number of studies have focused on one or more aspects of the warfare-welfare trade-offs. The growth of interest in this subject did not see the development of any consensus, however. For example, some studies concluded that there exists a negative trade-off between education and military spending in LDCs (e.g., Looney (1986). Other studies concluded that military spending did not bear negative consequences for education spending (e.g., Verner (1983); and Harris et al., (1988).1
To sum up, most of the studies on the economic impact of military spending have adopted one of the two approaches: The first approach relies on estimating single-equation models to capture the direct effects of military spending on economic growth through technical spin-offs of the military to civilian sectors and the resource mobilization effects. This approach is, by necessity, very narrow as it omits various important indirect channels through which military expenditure affects the balance of payments, savings and investment, and the development of human resources; which in turn exert significant influence on economic growth and development. Thus, most of the studies which follow this approach conclude that military expenditure has either a positive or insignificant impact on economic growth.
The second "comprehensive" approach combines both the direct and the indirect effects of military expenditure. It also emphasizes the importance of simultaneity, intermediate causation and feedback of the economic variables to measure the full repercussion of the defence sector on economic growth and development. Hence, the estimates of the studies in this category are more appropriate and generally support the existence of a negative impact of military expenditure on economic growth.
The analysis of the economic effects of military expenditure depends on the theoretical understanding of the role of this expenditure. However, economic theory does not offer obvious predictions and postulates on the impact of military expenditure on growth and development, because economic theories do not provide a unique role for military expenditure as a distinctive economic activity. Nevertheless, three broad approaches to the analysis of the economic impact of military spending can be distinguished: Neoclassical, Keynesian and Marxist theories.1
The neoclassical approach perceives the State as a class-neutral, rational actor which balances the opportunity costs and security benefits of military spending in order to maximize a well-defined national interest. Given the military technology, the economic problem is then to produce an optimum military capability at minimum cost. Thus, high military expenditure is explained by changes in technology. This approach is criticized for ignoring the internal role of the military by regarding only the potential external enemy to the State. This factor is very important for most LDCs where the development of a national consensus seems unreal. Moreover, this approach requires extreme knowledge and computational abilities on actors (Smith (1977), and Dunne (1990).
Keynesian theory postulates that military expenditure increases national output through the multiplier operations in the presence of inadequate effective demand. In the long run, if aggregate demand is lower than potential supply, increased military spending could raise capacity utilization and lead to increased rate of profit; and consequently raise investment and growth. Thus, this approach offers some economic justifications for military expenditure, as long as this expenditure is autonomous.
The Marxist approach sees military expenditure as necessary for the development of the capitalist system by maintaining effective demand and moderating the downward pressure on the rate of profit and, consequently, preventing economic crisis and breakdown. However, within the Marxist approach there are a number of strands for the treatment of crisis. For example, the underconsumptionst argument claims that military expenditure is important in preventing realization crisis that arises when the growth of productive forces and output exceeds effective demand and then put pressure on wages. In this case military expenditure prevents crisis as it allows the absorption of capital without decreasing wages and thus maintains profit (see Dunne 1990).
This section outlines the theoretical issues surrounding the defence-growth relationships with emphasis on LDCs in general and the African continent in particular. The emphasis here is on the impact of military spending on macroeconomic variables, and economic growth, rather than on economic development. This is so because growth is susceptible to quantification, although growth is a necessary but not sufficient condition for the development process.
Military spending influences economic growth through many conduits, both directly and indirectly. However, some major channels can be identified. These include its indirect effects on human capital formation, saving and investment, and the balance of payments, as well as its direct growth-stimulating effects. These effects are interdependent and interrelated, but we will treat them separately for exposition purposes, and the total effect on growth is best understood within the framework of multipliers and crowding out.
Human capital (including managerial, entrepreneurial and technical personnel) is an important factor of production. High growth rates can only be achieved by ensuring the availability of physical and human capital as well as other inputs required for national production. Adequate human capital may also increase the productivity of physical capital. Indeed, in LDCs, one of the major obstacles to rapid economic growth has been the absorptive capacity gap resulting from the lack of well-developed human capital. While it is clear that the relationship between military expenditure and human capital formation is very complex, it is also evident that military spending can influence human capital by generating employment, increasing the supply of skilled labour, and indirectly through its effect on government spending on education and health.
Certainly, the military mobilizes labour and offers employment to some individuals. In most LDCs soldiers are drawn from villages and rural agricultural sectors, where they are either unemployed or underemployed, or do not have access to employment centres. These employment benefits to the economy are, however, constrained by two considerations: Firstly, only a small proportion of the (economically active) population enters the army. Secondly, the military also frequently employs skilled labour, which is in short supply in most LDCs, and hence, reduces the amount available for civilian production.
Other economists argue that the military is an important source of technical and administrative skills which can subsequently be of use to the civilian economy. The armed forces provide education, and vocational and technical training during military service, skills which are scarce in LDCs. In this way the military can help to remove the absorptive capacity constraints and stimulate growth (Janowitz, 1964; Benoit, 1978). Moreover, it is often argued that the organizational skills and the modern attitudes and aptitudes of the military tend to break up social rigidities which inhibit human capital formation in LDCs.
While it is clear that the military teaches many skills that can benefit the civilian economy, especially in armies which are staffed by volunteers, these spin-offs should not be exaggerated.1 Some of the skills taught in the army are military-specific and expensive, while the military, very often, competes with the civilian sector for other scarce specialities (e.g., physicians and engineers). The transferability of the skills is also not automatic because they will not be available to the civilian sector for a large portion of their working life, particularly in countries with volunteer armies. Moreover, as Deger (1985) concluded that there is no reason why the military should be intrinsically more modern than other civilian institutions in removing social rigidities.
The main way in which military expenditure affects human capital formation is through its impact on government spending on education. In LDCs, where private education is minimal, the relationship between military and education spending is, however, not as straightforward as it might appear. Given the nature of military and education spending as publicly provided goods and given the upper limit on LDCs' budgets, there may be a one-to-one trade-off between the allocation of military and education expenditures, and consequently increases in military outlays may hinder the development of human resources. On the other hand, the military provides independently services such as training, education and health, although, as we have demonstrated, this spill-over is limited and expensive. Also studies have shown that in some LDCs increases in military outlays are met at the expense of economic and other welfare services rather than education and health spending.1
Military expenditure has another indirect effect on human capital formation. If the overall effect of military spending on economic growth is negative, and given the positive relationship between growth and human capital formation, then military expenditure can exert an indirect adverse effect on human capital accumulation.
On the whole, while it is not possible to draw strong conclusions, the evidence does suggest that the employment and technical spin-offs of the military are limited compared with the trade-off between military and education spending and, therefore, military spending has significant adverse effects on the human capital formation.
Undoubtedly, physical capital accumulation is an important ingredient in the growth process, and it can be affected by military expenditure through a multitude of interrelated channels, particularly through the impact of military spending on domestic savings and investment. In the case of LDCs, however, this relationship is not straightforward. Domestic savings are not automatically translated into productive investment because they might take the form of idle hoarding, be consumed wastefully or conspicuously, or be invested abroad. In addition, investment is constrained by the absorptive capacity of the economy, and part of it can be financed from foreign sources. In this section we consider this relationship and investigate the various channels through which military spending can influence both domestic savings and investment, and examine the overall impact of military spending on physical capital accumulation.
Military spending influences the level of domestic savings both directly and indirectly, and there is a considerable debate over whether the total impact is positive or negative. One argument claims that if increases in military outlays are financed by extra taxes then, if these expenditures are reduced in the future, it is possible to increase saving propensities. In LDCs, however, the taxable capacity is limited by the dominance of traditional and subsistence sectors and low income levels; beside the possibility of reducing private sector's savings by extra taxation. Moreover, the empirical analysis of the determinants of military expenditure shows that military expenditure is rigid downwards in most of the sub-Sahara African countries.1 A second argument suggests that the spirit of militarism and the structural change inspired by high military spending, especially during wars or periods of high threat perception, may alter the rate of time preference in favour of saving.1 This effect could equally, however, operate in the opposite direction.
In LDCs, the option of raising revenues from taxation is often not feasible. Budget deficits resulting from increases in military spending are usually financed by expanding the money supply through borrowing from the central bank. The expansion of the money supply, without corresponding increases in output, leads to increases in the inflation rate. Again the impact of inflation on domestic saving is not clear-cut. It is argued that inflation may lead to "forced savings". However, in LDCs money illusion, expectations of higher rates of inflation and falling real rate of return caused by inflation might lead to higher consumption and lower saving propensities.
Moreover, rises in threat perceptions, caused by increases in military spending, may increase the rate of time discount and consequently reduces the saving potentials (e.g., by rises in hoarding). Military expenditure also can reduce saving indirectly, if it reduces government expenditures on health and education services. This will increase the private consumption of these social wage goods and, hence, private savings will be reduced. Overall we expect, therefore, that in LDCs military expenditure will reduce the saving propensity, as was confirmed by the empirical studies reviewed in the previous section.
The impact of military expenditure on investment is the second channel through which the military affects physical capital formation. We have shown that military spending can retard savings; but this does not mean an equivalent reduction in investment. For a given level of saving, however, military expenditure crowds out investment in the short run, or causes other elements of aggregate demand to fall. In LDCs, where government revenue and expenditure are generally inelastic, this crowding out (resource allocation) becomes inevitable.
However, increased aggregate demand caused by autonomous increases in military spending will drive up output, capacity utilization and possibly profit rates. Higher profit rates may lead to more investment and higher growth in the long run. This multiplier effect requires the existence of surplus labour and excess production capacity. But in LDCs supply bottlenecks can prevent military expenditure from boosting output and some other components of aggregate demand will have to fall.
Moreover, in countries which do not produce arms, arms imports compete with imported investment goods for scarce foreign exchange and this hinders investment and the growth process; it might also retard technical progress.
As we have shown, military expenditure can have adverse effects on human capital formation and this in turn affects the rate of capacity utilization and the investment potential. Nevertheless, some infrastructural projects built by the military, such as roads or bridges, have spin-offs for the civilian sector. Many of these projects are, however, built in remote areas and do not suit civilian production. The above analysis gives strong reasons to believe that the effect of military spending on investment is negative on the whole.
Military expenditure in an open economy, specially in a non-arms producing country, leads to higher imports and deficits in trade balance and the balance-of-payments. Surplus in the trade balance gives a stimulus to growth in various ways. However, the effects of arms imports on the economy depend mainly on the way these imports are financed. Three ways can be identified: outright grants or aid; payment in cash or kind; and credit finance.
In the 1950s and 1960s outright grants prevailed. Superpowers donated sizeable amounts of weapons to LDCs for political and strategic considerations. Countries which received foreign military aid had a lower burden on their trade balance. However, because of economic and trade difficulties in developed countries, the structure of weapon imports finance has changed. Military aid to LDCs has declined rapidly relative to more commercial transactions.
Weapons purchased for cash or kind have serious economic effects. Foreign exchange is very often in short supply in LDCs, and this is exacerbated by costly arms imports. This will have obvious allocation costs in reducing investment goods essential for growth. In Africa, for example, military expenditures set limits to the possibilities of growth, in particular, in countries facing an acute shortage of development resources. The most immediate effect is the diversion of resources to military installations at the expense of much needed capital goods for development. Clearly, the import of foreign weapons systems does not have any potent economic returns. Moreover, shortages in inputs and spare parts caused by shortages of foreign exchange lead to further depreciation of the existing production capacity.
Credit finance is the third option for obtaining weapons imports. The credits, however, have to be paid back in hard currency, and possibly at high interest rates. This will crowd out investment goods in the future. It has also been argued, notably by Brzoska (1983), that military-related debts are quite substantial and add to the economic burden of weapons imports. More fresh capital will be needed to service the existing debt. This causes more foreign exchange shortages, and the `debt trap' is reinforced.
In addition, arms imports may also reduce savings indirectly because arms imports are usually exempted from imports tariffs. A second possibility is that export capacity can be reduced by previous weapons imports or military expenditures which drew resources from civilian sector investments. This will again lead to a more precarious balance-of-payments situation.
Nevertheless, it is often argued that weapon transfers might have some advantages. These include technical spin-offs and the attraction of more economic aid. The relevance of such spin-offs was discussed in the preceding section, and evidence for the correlation between economic aid and military expenditure was weak.1 Moreover, Eleazu (1973) claimed that most of the military assistance programmes to Africa had some built-in destabilizing factors and were responsible for many military coups and political instability. Therefore, we expect a priori that military expenditure, and particularly arms imports, to exert a substantial burden on the balance of payments and economic growth.
The previous sections have pointed out the various conduits through which military expenditure indirectly affects economic growth. In addition to those impacts, military spending also has direct effects on growth. There is a general consensus among defence economists that military expenditure stimulates growth directly through increased capacity utilization. This is achieved by Keynesian-type demand, spin-off and `modernization' effects; although there is no agreement on the volume and effectiveness of these factors.
If aggregate demand is initially inadequate relative to potential supply, then autonomous increases in military spending could lead to increased utilization of capacity, by increasing employment of labour or utilization of capital. Moreover, this reduces the cost of resources and leads to higher profit rates which drive up investment and growth. In poor countries, however, such benefits are probably small because such countries' major problems stem from the supply side (e.g., shortages of production inputs, foreign exchange, etc).
In many LDCs, the technological spin-offs discussed earlier, and the infrastructure developed by the army and introduced into the economy, might shift the production function upwards and bolster growth. The military also guarantees a suitable environment for production to proceed by preserving internal stability and security. Further, as in African countries, the military establishment engages directly in production activities: crop growing, food manufacturing and even commerce (e.g., the Sudanese Military Economic Corporation). Many economists, notably Benoit (1978), have argued that the military helps in the process of `modernization'. As an organized force it inculcates modern attitudes and work ethos; it thus creates a structure which is conducive to growth. It also contributes significantly to `nation building'. These factors are difficult to quantify in economic terms and are best understood in their socio-cultural framework. Moreover, it is also important not to confuse the analysis of the economic impact of military expenditure with the impact of military governments on development.
To sum up, military expenditure has both direct and indirect effects on economic growth. Therefore, the common simple analogy of the tank-tractor trade-off is not very helpful in understanding the impact of military expenditure. Although various effects can be enumerated, the complexity and simultaneity of the channels through which these effects operate prevent making a priori theoretical predictions on its final total impact. Thus the pros and cons of military spending need to be researched empirically.
The previous section outlined the broad theoretical analysis of the impact of military expenditure on economic growth, and the broad distinction between narrow and comprehensive approaches of estimating the effects of military expenditure. This section examines briefly the empirical findings of the extant research on the economic impact of military expenditure in LDCs, and Africa in particular.
Most of the post-Benoit studies (especially those which followed the comprehensive approach) found evidence for the negative impact of military expenditure on LDCs' economic growth.1 Four of these studies have focused on the African continent: Smith & Smith (1980), Nabe (1983), Gyimah-Brempong (1989) and Mohammed (1992).
Smith & Smith (1980) claim that not only do the military burden and the saving rate influence economic growth, but they are in turn influenced by it. Thus, they used the Three Stage Least Squares (3SLS) method to estimate a three-equation simultaneous model (growth, saving and military burden) for a sample of 50 LDCs. The data were averages for the 1965-1973 period. The results also show a negative effect on saving and a very small and insignificant positive effect exerted on economic growth. Nevertheless, they investigated the relationship, between military spending and economic growth, across 18 African countries for the 1965-1973 period. Their evidence, however, did not support the existence of a statistically significant relationship between growth and military burden.
Nabe (1983) claimed that both economic and social variables determine development. He, thus, formulated two composite development factors - one economic (EDF) and one social (SDF)- by means of factor analysis to assess the impact of military expenditure on industrialization in 26 African countries over the 1967-1976 period. Nabe, then, constructed a multi-equation model. His model was recursive and triangular, in which the EDF is made a function of military expenditure (M), the SDF is a function of M and EDF, while the GDP manufacturing depends on EDF, SDF and M. The results of the cross-sectional longitudinal and cross-sectional analyses confirmed that military expenditure has an indirect negative impact on GDP manufacturing through both the economic and social development factors.
Gyimah-Brempong specified a four-equation simultaneous model, with one equation each for economic growth rate, investment rate, skilled labour rate, and defence burden, to investigate the growth-defence relationship. He postulated that investment is a more appropriate mechanism to investigate the growth-defence relation than savings (because of hoarding); and that economic growth determines military allocations together with security related factors. He estimated the model for 39 Sub-Sahara African countries during the 1973-1983 period, and calculated a defence burden-growth rate multiplier of -0.12.1
Mohammed (1992) argues that military expenditure can have a direct positive effect on growth through various spin-offs. However, it also exerts a significant adverse influence on investment allocations, human resource development and balance of payments; these variables in turn affect economic growth. Moreover, the total impact of military expenditure depends on its level, trends and the country's socio-economic conditions. He then, chooses thirteen Sub-Sahara African countries for analysis: Benin, CAR, Ethiopia, Kenya, Mali, Niger, Rwanda, Somalia, Sudan, Tanzania, Togo, Uganda, and Zaire. The choice was motivated by the many similarities in political, socio-economic and historical realities.
A five-equation simultaneous model (one each for economic growth, investment ratio, education spending ratio, balance of trade and military burden) is formulated and subjected to empirical investigation by techniques of time-series and cross-sectional estimation, for the period 1967-1985. The results affirms that it is difficult to establish a systematic relationship between military burden and economic variables for the whole sample because the effects of military expenditure on individual countries are different despite the relative homogeneity of the sample. In countries where the military burden was high and increasing, military expenditure had an apparent negative effect on economic growth, investment allocations, and human capital formation, and it contributed to the huge deficits in their balance of payments; while in countries with low military burden the positive spin-offs dominated this negative role of military expenditure. Moreover, these positive and negative effects were balanced in countries with moderate military burdens and, therefore, the total effect of military expenditure was negligible and insignificant. The overall evidence does, however, suggest that military spending hinders economic performance in most Sub-Sahara African countries.
These findings support the recent empirical evidence on the economic impact of military expenditure on LDCs economic development (e.g., Deger (1986), and Scheetz (1991). Moreover, while the macrostatistical studies of the economic effects of military expenditure on large samples of LDCs are important in pointing to general characteristics of the military-growth nexus, they tend to omit the country-specific conditions which are very important for the understanding of these effects. Therefore, the combination of both cross-sectional and time series analyses provides more insight into the mechanism of military expenditure in LDCs. Mohammed's (1992 & 1993 c) study of the Sudan corroborate this argument.
Apart from the defence-growth nexus in LDCs, a considerable number of studies have focused on one or more aspects of the warfare-welfare trade-offs. The growth of interest in this subject did not see the development of any consensus, however. For example, some studies concluded that there exists a negative trade-off between education and military spending in LDCs (for example, Looney (1986). Other studies concluded that military spending did not bear negative consequences for education spending (e.g., Verner's (1983) study of Latin America countries over 1948-79 period, and Harris et al. (1988).1
Most of the conflict theories emphasize the importance of economic conditions in explaining conflict, as one important aspect of militarization. For example, Homer-Dixon's (1990; 15-20) frustration-aggression and structural theories of conflict, stress the importance of economic factors to explain civil strife and wars. Different international, regional and national conflicts were motivated by economic factors as well documented in the literature (e.g, the recent conflict in the Gulf).1
In this section we will briefly focus on one aspect of militarization, which is military spending. The empirical studies on the determinants of military spending confirmed the importance of economic factors (such as level of income, government spending) in determining military allocations.1 Mohammed (1992: 43-65) investigates the major determinants of military spending in thirteen sub-Sahara African countries, in the period 1965-1985. The differences in the military burdens of the African countries appear to reflect a complex of economic, political and strategic factors, both at the national and the international levels. While the relative importance of the different factors varied from country to country, the need to maintain security and stability, and to counteract threats is found to be the most important factor in most countries. However, while the income level was not binding for most countries, the military spending proved to be sensitive to the
Figure 3
economic conditions. The most important single economic factor is found to be the share of the central government in GDP. Furthermore, this study shows that economic growth per se, does not play a systematic role in determining military expenditure in Africa.
Most of the military coups in Africa were also motivated by the desire to improve the deteriorating economic conditions.1 Food shortages, drought, decrease in agricultural production, and shortages in other human basic needs, contributed to social tension, and consequently high militarization of many LDCs (by military coups).
To sum up, there are very strong theoretical and empirical grounds for the causal link between militarization (conflict or higher military spending) and economic conditions. This causation was confirmed by many empirical studies, and particularly in LDCs, although most of these studies have focused only on one direction of the causal link. Moreover, there are also some indirect conduits through which the economy effect militarization, and vice versa (See Figure 3 for the relationship between militarization and the economy). The environment is one of the most important links between militarization and the economy. The next section tackles these causal links.
