Abstract:
Dunne and Nikolaidou (2005) pointed out the importance of relatively homogenous countries in sampling on economic impacts of military spending. In this regard, our paper aims at investigating long-run causal relationship between military expenditures and economic growth among the superpower countries of the world using ARDL approach and Toda Yamamoto technique over the period 1973-2011. The most remarkable findings of the paper are the one group of countries composed of 7 members of G8 and the general tendency in the split of causality which can be described as developed and developing countries.
