Multiple defense trajectories in the Middle East: evidence from a club convergence analysis

Despite operating within one of the world’s most conflict-prone regions, Middle Eastern states have not converged toward a common military burden trajectory. This paper examines the long-run dynamics of military expenditure as a share of GDP across ten Middle Eastern economies during 1990-2025 using the club convergence framework. The log-t test strongly rejects overall convergence, indicating that common regional security pressures have not generated similar fiscal-defense responses. The clustering procedure identifies two convergence clubs and one divergent unit. The first club, Israel, Saudi Arabia, Oman, Kuwait, Jordan, and Bahrain maintains persistently high military burdens but exhibits weak internal convergence due to differences in oil revenues, economic scale, and defense financing structures. The second club, Iran, Türkiye, and Lebanon displays more coherent transitional dynamics associated with shared fiscal constraints and greater reliance on domestic defense capacity. Egypt diverges from both groups, reflecting increasing tension between regional strategic ambitions and fiscal limitations. The findings suggest that convergence emerges not among the highest spenders, but among economies facing similar resource constraints and defense burden management strategies. Overall, regional averages obscure substantial structural fragmentation in Middle Eastern defense expenditure dynamics.