The effect of military spending on economic growth in MENA: evidence from method of moments quantile regression

Abstract

AbstractThis study adopted a novel quantile regression via moments to explore the effects of military spending on the distribution of economic growth of 14 MENA countries over the period from 1981 to 2019. The method, apart from enabling us to investigate the effects of military spending on the distribution of economic growth at different quantiles, also helps to address issues of heterogeneity and endogeneity characterising the panel studies. Our results showed that irrespective of measures of military spending and economic growth, an upsurge in military spending leads to a positive effect on economic growth at different quantiles, suggesting that military spending is productive and growth-enhancing in the MENA countries.