Military Spending and Inequality in South Africa: An ARDL Bounds Testing Approach to Cointegration

Mduduzi Biyase, Joel Eita, Thomas Udimal and Talent Zwane
Additional contact information
Thomas Udimal: Southwest Forestry University
Talent Zwane: College of Business and Economics, University of Johannesburg

Economics Working Papers from College of Business and Economics, University of Johannesburg, South Africa

Abstract: There has been an increasing interest in understanding the relationship between inequality and military spending. However, given the multifaceted nature of the relationship between these variables, studies have yielded inconsistent results. While some studies in this field considers military spending to be unfavorable to inequality, some studies have found evidence to suggest that it reduces inequality. In South Africa there is comparatively no empirical work investigating the issue. Thus, this paper is the first to investigate this relationship in South Africa and helps to shed some light on the empirical puzzle, by using autoregressive distributed (ARDL) and bounds test for cointegration method. The empirical result established a long run relationship between military expenditures and income inequality in South Africa. An increase in the military expenditures result in high rate of inequality. Based on these findings, it is appropriate for the government's expenditure to be directed at the sectors that have direct impact on the large segment of the population. Military expenditure by its nature is very restrictive and the gains do not trickle down to those who are "trapped" in the quagmire of poverty. It is therefore recommended for more expenditures be directed at "pro-poor" sectors that have direct link with the masses. Government expenditures in the "pro-poor" sectors would help in lifting out those who are experiencing "poverty trapped" and requires the assistance for liberation.

Keywords: inequality; military spending; error correction; ARDL bounds testing (search for similar items in EconPapers)
JEL-codes: C22 H56 (search for similar items in EconPapers)
Pages: 25 pages
Date: 2022, Revised 2022
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://edwrg.education/RePEc/ady/wpaper/w5_2022.pdf First version, 2022 (application/pdf)
Our link check indicates that this URL is bad, the error code is: 500 Can't connect to edwrg.education:443 (No such host is known. )

Related works:
Journal Article: Military Spending and Inequality in South Africa: An ARDL Bound Testing Approach to Cointegration (2022)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ady:wpaper:edwrg-05-2022

Access Statistics for this paper

More papers in Economics Working Papers from College of Business and Economics, University of Johannesburg, South Africa
Bibliographic data for series maintained by Frederich Kirsten ().