Military spending, technical progress, and economic growth: a critical overview on mainstream defense economics

This article, which focuses on the macro-dynamic branches of defense economics, aims at showing that the mainstream literature – the neoclassical school or the methodologies closely related to it – devoted to the effects of military spending stumbles over worrying difficulties, by throwing light on its insuperable theoretical and empirical limitations. The authors’ criticism applies to: demand-side and supply-side models (first part); formalizations with technological spin-off effects, externalities or public goods (second part); and simulation models, including the most recent ones with endogenous technical progress growth models (third part).