Study on the Influence of Economic and Social Factors on the Financing of National Defense

Abstract

In the Romanian literature and current research, the financing of national defense is a less debated topic. Most studies are conducted mainly for developed countries, which also have the most advanced military systems and focus only on the correlation between military spending and the economy. The objective of the paper is to investigate the correlation between the evolution of military spending in Romania during 1919-2012 on the one hand, and economic, political and social factors, on the other. The empirical study performed used the linear regression model, estimated by the least squares method (OLS), using the statistical software EViews 10. The results of the study showed that the level of financial allocations to the defense budget were largely influenced by the level of economic and social development of Romania during the research period as well as by the options of political decisions.

Keywords

• national material capabilities
• military spending
• regime type
• economic growth