Military Expenditure in Turkey: a Cointegration Analysis

Abstract

Military expenditures can be affected by countries’ present and potential threats as well as several other economic factors. This situation requires analysis of the reasons for changes in military expenditures in the country. In this study, militaryexpenditures of Turkey between 1970-2017 period are analyzed within the scope of its allies, external threats and internal threats as well as other explanatory variables. For external threat data Greece’s militaryexpenditure, for allies data North Atlantic Treaty Organization countries’militaryexpenditures, for internal threat data terror incidents index and Turkey’s per capita gross domestic product are used as an explanatory variable. Cointegration test was performed using ARDL method with the data collected from various internationally accessible and open sources. Greece’s militaryexpenditures and terror index have been found in a positive long term relationship with Turkey’s militaryexpenditures.