Defense Spending and Economic Growth in Iran: Evidence from Co-integration Analysis

The impact of defense spending on gross domestic product (GDP) growth is not clear and deserves detailed empirical analysis. According to the Atesoglu (2002), this study presents new empirical evidence on the relationship between the level of economic growth and defense spending in the case of Iran for the period of 1990-2014. On using new macroeconomic theory and multivariate co-integration procedure, this study demonstrates empirically that there exists a positive long-run relationship between defense spending and economic growth in Iran. In addition, the CUSUM and CUSUMSQ tests confirm the stability of the economic growth function.

کلیدواژه ها:

Economic Growth ، Defense Spending ، Co-integration ، Iran.