This article examines how deteriorating global security conditions after 2014 and 2022 affected the revenue development and related economic indicators of the Czech defence industry. Using financial data from 18 companies for the period 2014-2023, the study applies a production-function framework combined with descriptive, correlation, and trend analyses to test whether employment, assets, and revenues grew consistently under rising defence demand. The results show that while aggregate indicators increased, company-level developments were uneven, cyclical, and strongly shaped by structural constraints and volatility of state procurement. These findings call into question the conventional assumption that worsening security automatically generates continuous industrial expansion. By linking theoretical concepts from defence economics with detailed company-level evidence, the study provides the first comprehensive assessment of how a small open economy translates external security shocks into industrial performance, offering new insight for both policy and comparative research in the field of defence economics.
Šlouf et al. (Thu,) studied this question.
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