Asymmetric and Threshold Effect of Military Expenditure on Economic Growth: Insight from an Emerging Market-Reference-Cited by-同舟云学术

Asymmetric and Threshold Effect of Military Expenditure on Economic Growth: Insight from an Emerging Market

Published:2024-09-10 Issue: Volume: Page:
ISSN:1079-2457
Container-title:Peace Economics, Peace Science and Public Policy
language:en
Short-container-title:

Author:

Dada James Temitope¹^ORCID,Sharimakin Akinwumi²,Al-Faryan Mamdouh Abdulaziz Saleh³⁴^ORCID,Tabash Mosab I.⁵,Adeiza Adams⁶⁷

Affiliation:

1. Department of Economics , Obafemi Awolowo University , Ile-Ife , Nigeria

2. Department of Economics , Adeyemi College of Education , Ondo , Ondo , Nigeria

3. Faculty of Business and Law , School of Accounting, Economics and Finance, University of Portsmouth , Portsmouth , Hampshire , UK

4. The Saudi Economic Association , Riyadh , Saudi Arabia

5. College of Business, Al Ain University , Al Ain, Abu Dhabi , United Arab Emirates

6. Malaysian Graduate School of Entrepreneurship and Business (MGSEB), Universiti Malaysia Kelantan , Bachok , Kelantan , Malaysia

7. School of Management and Business , Mila University , No. 1, MIU Boulevard , Putra Nilai, 71800 , Nilai , Negeri Sembilan , Malaysia

Abstract

Abstract This study aims to investigate the asymmetric effect of military expenditure on economic growth in Nigeria. Furthermore, it determines the threshold level of military expenditure that spurs or hinders economic growth in Nigeria. To achieve the study’s objectives, the nonlinear autoregressive distributed lag (NARDL) and dynamic threshold autoregressive (TAR) techniques are applied as estimation techniques to data from 1981 to 2020. The findings from the study show that (1) positive shocks in military expenditure negatively impact economic growth in the short run, while the effect turns positive in the long run. (2) Negative military expenditure shocks negatively influenced economic growth in Nigeria in both periods. (3) The result from the threshold regression found a threshold value of 0.579 for military expenditure. Based on these findings, policymakers must consider the inherent tendency of asymmetry and nonlinearity in military expenditure when formulating policies related to government spending.

Publisher

Walter de Gruyter GmbH

Link

https://www.degruyter.com/document/doi/10.1515/peps-2023-0067/pdf

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