Document Type
Social Sciences
Abstract
This study examines whether military expenditure reduces inequality-adjusted human development and how national governance quality moderates these effects. Using panel data covering 121 countries from 2010-2023, two-way fixed effects models are employed to estimate the relationship between military spending and the Inequality-Adjusted Human Development Index (IHDI). Three key findings emerge from the analysis based on the resulting data. First, a one percentage point increase in military spending reduces IHDI by 0.0012-0.0015 points. Second, the effects prove seven times larger in developed countries than in developing ones, which runs contrary to expectations and prior literature. Lastly, political stability emerged as a critical governance moderator (β = 0.00801, p < 0.001), while no significant relationship was found with the governance indicator of control of corruption. These findings demonstrate how military spending can impose measurable welfare costs through inequality-adjusted channels even in the wealthiest of nations, and how the political stability and violence/terrorism dimension of governance matters more to development outcomes during conflict-heavy periods than administrative corruption.
Recommended Citation
Graham, Connor
(2026)
"Protection vs. Progression: A Macroeconomic Approach to Military Expenditure Direct Effects on Social Outcomes Using IHDI Measures,"
Global Tides: Vol. 20, Article 3.
Available at:
https://digitalcommons.pepperdine.edu/globaltides/vol20/iss1/3
Included in
Defense and Security Studies Commons, Econometrics Commons, Economic Policy Commons, Growth and Development Commons, International Economics Commons, Macroeconomics Commons, Military and Veterans Studies Commons, Peace and Conflict Studies Commons, Policy Design, Analysis, and Evaluation Commons, Political Economy Commons, Public Policy Commons, Social Policy Commons, Social Welfare Commons
