Using the Feder-Ram and military Keynesian models to examine the link between defence spending and economic growth in Sri Lanka

Albert Wijeweera, Matthew J. Webb

    Research output: Contribution to journalArticlepeer-review

    6 Scopus citations

    Abstract

    This study uses the Feder-Ram model in conjunction with the military Keynesian model to examine the nexus between defence spending and economic growth in Sri Lanka. We find that the Keynesian aggregate demand model is better suited to analyse the link than the Feder-Ram model for the case of Sri Lanka. Based upon our results we expect a higher economic growth rate in Sri Lanka if more public resources are diverted from the defence to civilian sectors of the economy, now that the war between the government and separatist guerrillas has come to an end. However, recent post war events cast doubt upon whether a diversion of sources from military to non-military spending will actually occur. We conclude that the sanguine predictions of our economic analysis are entirely dependent upon the political decisions of the Sri Lankan government for their realization.

    Original languageBritish English
    Pages (from-to)303-311
    Number of pages9
    JournalDefence and Peace Economics
    Volume23
    Issue number3
    DOIs
    StatePublished - Jun 2012

    Keywords

    • Defence
    • Feder-Ram
    • GDP growth
    • Keynesian
    • Sri Lanka

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