Benoit Hypothesis revisited: defence expenditure and economic growth in Putin-era Russia, 2000–2024

The Benoit Hypothesis suggests that defence spending can boost economic growth. This study tests the relationship between defence spending and economic growth in Putin-era Russia during the period 2000–2024 using the ARDL method. A bivariate analysis using data from the IMF, SIPRI, Rosstat and the World Bank indicates that military expenditure has a negative and significant effect on growth (−2.96; p = 0.035). However, when control variables such as the oil-gas share, oil price, gross capital formation, trade openness and population growth are added to the model, this effect loses its significance (−1.27; p = 0.291), whilst investment and trade openness emerge as the key determinants of growth. Cointegration and ECM results confirm the long-term relationship. The findings indicate that the Benoit Hypothesis does not hold in the case of Russia and that growth is more dependent on structural economic factors than on defence expenditure.