Effect of Military Expenses on Economic Growth in Middle East Countries: Using Generalized Method of Moments (GMM)

This paper examines the effect of military expenses on economic growth in 11 Middle East countries. Sensitive and strategic position of Middle East region on the one hand and increase in the military spending of countries in this region on the other hand, the need to examine the effect of military spending on economic growth in the countries in this region is very important. In this regard, used an augmented Solow model (proposed by Knight, Loayza and Villanueva (1996)) during the period 1988-2012. The results of this research by using dynamic panel approach and generalized method of moments, show the negative impact of military expenses on economic growth in the Middle East countries. So, if the region of Middle East is stable politically, the expenses of economic development are replaced by military expenses and there will be more economic growth in the Middle East countries.
The results of this research by using dynamic panel approach and generalized method of moments, show the negative impact of military expenses on economic growth in the Middle East countries. So, if the region of Middle East is stable politically, the expenses of economic development are replaced by military expenses and there will be more economic growth in the Middle East countries.