The impact of military spendings on economic growth of Pakistan

Authors

  • Sajjad
  • Tariq
  • Muhammad Tariq

DOI:

https://doi.org/10.34260/jaebs.116

Keywords:

Military spending, Economic growth, ARDL, Pakistan

Abstract

A sound national defence is extremely essential for a country’s sovereignty. The geostrategic position of Pakistan and its deterrence policy against neighbouring India have generally been the reasons for stringent military financing. Defence spending affects all sectors of the economy directly or indirectly. This study aims to investigate the influence of government military expenditures on the economic growth of Pakistan over the period 1987-2016. Augmented Dickey-Fuller test has been used for checking the unit root in the data. Autoregressive Distributed Lag (ARDL) bounds testing approach to cointegration has been applied to analyze the relationship between military spending and economic growth. The findings indicate that military expenditure has a positive impact on Pakistan's economic growth in the long-run, however it has negative effect on economic growth in the short-run.

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Author Biographies

Sajjad

Assistant Professor of Economics at Higher Education Department, Khyber Pakhtunkhwa.

Tariq

PhD Scholar, Department of Economics, Abdul Wali Khan University, Mardan.

Muhammad Tariq

Assistant Professor, Department of Economics, Abdul Wali Khan University, Mardan

Article

Published

2017-12-30

How to Cite

Sajjad, Tariq, & Tariq, M. . (2017). The impact of military spendings on economic growth of Pakistan. Journal of Applied Economics and Business Studies, 1(1), 53-64. https://doi.org/10.34260/jaebs.116