Military Spending and Economic Growth - Research Paper Example

Military Spending and Economic Growth The study of economic expenditure has proved to be something of high impedance to the economy and economic growth of a country. The debate on whether military expenditure affects the economy positively or negatively has been here for a while with both has evidence proving their case. Adam Smith, who is considered to be the father of the modern economics reflected the importance of military expenditure to economic growth by terming it as a government’s first duty. It is undoubtable that military expenditure has some extent of importance to the economic growth of a country. With reference to Asia, this paper aims at discussing the extent to which military spending has promoted economic growth in the continent. One of the positive effect that military expenditure can have on a country come through the training process that military participants are always taken through. The skills and techniques that are acquired through this process are varied. When these skills and experience are later used in economic activities, they have proved to be very important in increasing the productivity of individuals. The experience and skills that are acquired from military training include things such as reaction to instructions, discipline, wise usage of money, getting familiarity with certain products, gaining geological experience, and the instilment of the values and attributes of the country (Braşoveanu 2010, p. 148). Trained military men can take these skills and experience to various sectors of a country’s after they leave they leave the army. A good example of such a case would be in Japan where the soldiers are credited for being the most valuable contributors to the country’s growth. Throughout the history of this country, the soldiers who were at some point referred to as the warrior class were highly valued for being the standard reference to the highest standards of the work virtues of the Japanese people. This system has continued and can be easily noticed in the modern Japanese society. In Japan, ex-soldiers are well known for their discipline, diligence, and hard work in various industry sectors that they involve.The military training system in Japan is designed in such a way that it demands the best of the contribution of the soldiers. Military expenditure in most Asian countries has a big influence on the development of their infrastructure. The military is always involved in the creation of infrastructures such as roads, bridges, airports, docks, and many others (Adams, Behrman & Boldin 1991, p. 28). These infrastructures usually help in enhancing economic activities in a country. Enhance economic activities are likely to positively reflect on the economic growth and development of a country. A good example of military involvement in Asia is the Chinese military involvement in the strategic road in Tibet. Apart from the involvement in the building of infrastructure, the military expenditure can also contribute to a country’s economy through activities such as mapping, disaster rehabilitation, surveying, meteorological and geological researches. These activities usually influence economic growth in a country either directly or indirectly. For instance, during the floods of Thailand in the year 2011, the military were used extensively in the rescue mission and the disaster rehabilitation process in general. Failure to promptly respond to natural calamities and disasters such as floods can lead to the occurrence of undesirable economic consequences. The main purpose of government to invest on military is the security effect that results from having a strong military. Security is a requirement for social, political, and economic wellbeing. This makes military investment important for the economic growth of a country. This means that a country that is having more military expenditure is likely to have more economic activities going on within its borders. A country that is known for its high security standards arelikely to attract more investors as compared to those that have less security standards (Murdoch, Pi & Sandler 1997, p. 232). This will definitely reflect to the economic growth of the country. Some sectors of the economy, such as tourism will definitely boom in a country that has the popularity of having high security standards. This will particularly be true when external tourism is the case. A good example is the way in which China’s increase in military expenditure has improved the security status of the country and the economytoo. The economy of China has enjoyed as steady rate of investment and economic growth as a result of the high security standards in the country. Military expenditure will also lead to an advancement of a number of other sectors of the economy. For instance, military expenditure has been discovered to positively influence fields such as engineering, general science, electronics, geology and a number of other fields. Military expenditure increases the number of resources that are allocated to these sectors leading to an increase in the number of professionals in these sectors (Yildirim, Ocal & Keskin 2011, p. 811). When the number of professionals in these sectors increases, they do not only contribute to the growth and development of the military, but also to the growth of the various industries that they are involved in. An example of a scientific invention that was a result of military expenditure is the MTech FeverScan which was invented in Singapore. This device makes use of precise thermal imaging to detect fever. This invention was later produced commercially and availed to civilian. This must have really influenced the economy of the country. The internet which is currently used globally was an invention that was a result of scientific activities that were financed by military investment in the 1960s. A strong military base can lead to political stability in a country. Countries with strong military based have been observed to enjoy political stability as compared to those with relatively weaker military base. This is particularly true when countries of these characteristics in Asia are observed. A country with political stability will experience smooth economic operation as opposed to the countries that have political stability. When the economic activities have a smooth and a favourable operational environment, the country will be experiencing a steady growth of its economy because of the favourable economic environment (Galvin 2003, p. 55). This will also lead to an increase of the number of attractions of investors into the country’s economy. This can be explained through the difference between the militaryexpenditures of China and India and the difference in the rate of the growth in their economies. Expenditure onthe militarycan also contribute to certain industries in the economy of a country. Countries that have weapon and other war related material will obviously buy these materials from the local business organization (Tzeng, Lai & Huang 2008, p. 475). This will mean that the industries will have a growth because of this expenditure. When a government spends on military materials, they usually do son in bulk. When the industry in question grows the country’s economy will also benefit from such developments positively. For example, the Hindustan Aeronautics Limited has a highly benefited from the Indian government’s expenditures on military aircraft. They are one of the major beneficiaries of the government’s expenditure on the military. This kind of expenditure has generally increased their sales volumes thus increasing their gross income. This might also contribute to the increase of production volume in this industry. This means that they will be making use of our resources during their productions such as labour and other resources such as energy. This kind of economic involvement will definitely benefit the economy of an economy positively. Military expenditure usually involves investment in researches that are usually aimed at making sure that the military status of the country is developed. Though this is not commonly done in a developing country, it is commonly done in the developed countries in Asia. The importance of such investment is that in the process some findings that can be beneficial to the civilians in thecountries are usually made. When the uses of these findings are commercialized there is always a positive effect on the country’s economy (Dunne, Smith & Willenbockel 2005, p. 452). Apart from the commercialization, some of these findings also come in handy because they are used by business organizations in the process of improving their business operation through reducing the cost of production or improving the quality of their products and services. Investment in the military can also help a country in avoiding the occurrence of man-made disaster. The most common form of man-made disaster of this age is terrorism. When a country has a military that is prepared for such possibilities they can be able to detect such occurrence before they even take place. This will mean that they will be able to counter such attempts in good time before they cause the intended damage (Garfinkel1990, p. 99). Man-made disasters such as terrorism usually affect the economy of a country negative. Whenever terrorism takes place there is always a situation where there are massive losses by business organizations that would eventually affect the economy of the countries. The affected business organizations usually take some time before they recover to full operation. The losses that are incurred in the process can even lead to some economic player completely discontinuing their economic activities. As a result of terrorist attacks a country faces the possibility of losing both the existing and the potential investors. All these cases will affect the economy of a country negatively. However, in cases where there has been a timely realization and reaction to such attacks, the government would have avoided all the above mentioned effects of man-made disasters(Kelly & Rishi 2003, p. 17). The incident when an attempted terrorist on a Suez ship was known with time and attended to be a good example of such a case. The result of such response was that the countries that would have been negatively affected did not have to face the consequences of the potential terrorist attack. Just like any other expenditure by a government, a government’s expenditure on its military also has some influence on a country’s economy. The lower the amount the government spends the lower the rate at which the economy of the country grows (Rashid & Arif, 2012, p. 38). This is because of the way government expenditure can result in an increase in the purchasing power into the economy of a country. In this process the government can increase the amount of money that is circulating in the economy by increasing the purchasing power of the private sector. As a result of the amount of money in the circulation, there will be an increase in economic activities that will be as a result of the various players in the economy reacting to the increase in their products as a result of an increase in the purchasing power of the public. However, government expenditure on a country’s military should be moderated. This is because if a country overspends on the military they might end up affecting the country’s economy negatively. This is because of the amount of forgone expenditure that might be of greater significance to the economy of a country as compared to the importance of military expenditure. Another way through which military expenditure benefits the economy of a country is because of the way in which provides job opportunities a big number of citizens of a country. As a result of increased military expenditure, especially those involving hiring and training of new personnel, the government usually offers job opportunities. in the absence of the military. A good example is in India, where military expenditure employs more than 2.5 citizens. This number has gradually increased in the last few years as a result of the increase in military expenditure allocations over the last few years. The money that is earned by military personnel can be used for further provision of another job or purchasing of goods and services. s With minimal expenditure on the military, the military will have to do with few personnel a factor that will lead to an increase in unemployment in the country. Unemployment in itself is an indication of poor economic development in a country. On the other hand, unemployment in developing countries can also result to involvement in activities such as political rebels and terrorism. This is because when people are unemployed, they are always willing to involve themselves in any activities that will at least earn them some money to take care of their basic needs. In developing countries, it has been discovered that most terrorist attacks are always successful through the involvement of some unemployed insiders. It should be noted that military expenditure is not completely beneficial to the economy. If not carefully undertaken military expenditure could have negative effects of the economic growth of a country. There are a number of factors that can be used to support this reasoning. One of the reasons is that spending on military produces less job opportunities as compared to the job creation that could have resulted from other forms of investments. This is particularly true, especially when investments that have direct impact on the economy of a country are considered. The only difference is that in the case of military expenditure, there are other essential needs of the country such as security that are taken care of when a government invests in military. Extensive expenditure on the military can also mean a shortage of resources in the other industries that contribute to the growth of a nation. Resources such a human labour, equipment, and material that make use of when there is more expenditure on military, are the same resources that are needed for the other industries that contribute to the growth of the economy. In this line it can be argued that expenditure onthe military can interfere with the supply of these resources to the rest of the industries. This might lead to underperformance of the other industries. This means that the economy of the country in question will be negatively affected, especially when the industries involved have a direct effect on the economy of the country. When these industries are poorly performing the economy of the country will also be performing poorly. It is clearly evident that military expenditure has some extent of effect on the economy of a country. . The debate on whether military expenditure affects the economy positively or negatively has been here for a while with both has evidence proving their case.In countries in Asia it is clearly evident that expenditure on, the military has been highly beneficial to their economy. The benefits range of inventions, provision of job opportunities, enhancement of security, contribution to infrastructure development, production of highly reliable human labours and many others. These effects make it economically viable for a government to decide on investing in their military. However, when a government decides to invest in their military they should make sure that they do it cautiously. This is because if it is not done in the required way and time it can lead to the occurrence of negative effects to the economy. A common way that a government can go wrong when spending on military is by overspending. 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