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DEFENCE AND NON-DEFENCE SPENDING IN THE USA: STIMULI TO ECONOMIC GROWTH? COMPARATIVE FINDINGS FROM A SEMIPARAMETRIC APPROACH

Authors

  • Christos Kollias,

    Corresponding author
    1. Department of Economics University of Thessaly, Volos, Greece
    • Correspondence: Christos Kollias, Department of Economics, University of Thessaly, Korai 43 str, 38333 Volos, Greece. Tel: +302421074925; Fax: +302421074772; Email: kollias@uth.gr. The authors are grateful to Thanasis Stengos for helpful advice and to an associate editor and two anonymous referees of this journal for helpful and constructive comments on earlier versions of the paper. The comments and suggestions from participants in the 15th Annual Conference on Economics and Security, University of the West of England and University of Bristol, 16–17 June 2011 are also gratefully acknowledged. The usual disclaimer applies.

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  • Suzanna-Maria Paleologou

    1. Department of Economics, Aristotle University of Thessaloniki, Greece
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ABSTRACT

Given its significant policy implications, the nexus between public expenditures and economic growth has been the subject of an extensive and often emotive theoretical and empirical debate. In this paper, a semiparametric model is used to explore the link between GDP and defence and non-defence government spending in the USA over the period 1929–2009. Evidence reported herein indicates that the latter represents a greater stimulus vis-à-vis the former.

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