Handbook on the Economics of Conflict
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Handbook on the Economics of Conflict

Edited by Derek L. Braddon and Keith Hartley

The Handbook on the Economics of Conflict conveys how economics can contribute to the understanding of conflict in its various dimensions embracing world wars, regional conflicts, terrorism and the role of peacekeeping in conflict prevention.
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Chapter 6: The Government Budget Allocation Process and National Security: An Application to the Israeli–Syrian Arms Race

Itay Ringel and Asher Tishler


Itay Ringel and Asher Tishler 6.1 INTRODUCTION 6.1.1 Trends in World Military Expenditures In 2007, 14 major armed conflicts were being actively waged in 13 locations around the world. The year 2008 was also characterized by a continuing shift from multi-state armed conflicts to a complex mixture of less intensive but numerous localized ‘mini’ conflicts. In addition, global military expenditure continued to rise for many reasons, including foreign policy objectives, real or perceived threats, and multilateral peacekeeping operation (SIPRI, 2008). World military expenditure in 2007 has been estimated at $1214 billion (at constant 2005 prices), an increase, in real terms, of 6 percent from 2006 and 44 percent since 1997. In 2007, world military expenditure represented 2.5 percent of world gross domestic product (GDP), or a global per capita expenditure of $202. The end of the Cold War was marked by a reduction in global military expenditure in the 1990s, as shown in Figure 6.1, but then the local disputes in Eastern Europe and Africa in the late 1990s undermined this trend. The conflict in Kosovo, the 9/11 attack, the spread of local disputes from 2000 to 2003, and the active role of the United States and Western Europe in these conflicts brought about an increase in global defense spending (Golde and Tishler, 2004). Global military expenditure by region is depicted in Figure 6.2. Between 1997 and 2007, the greatest increase in global military expenditure occurred in the Middle East (78 1200 Billion $ at 2005 prices 1100 1000 900 800...

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