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THE IMPACT OF NATIONAL DEFENSE EXPENDITURE ON GROWTH OF ECONOMY IN SRI LANKA
THE IMPACT OF NATIONAL DEFENSE EXPENDITURE ON GROWTH OF ECONOMY IN SRI LANKA
- Source :
- International Journal of Research -GRANTHAALAYAH. 9:18-25
- Publication Year :
- 2021
- Publisher :
- Granthaalayah Publications and Printers, 2021.
-
Abstract
- This study aims to analyze the relationship between defense expenditure and growth of the economy in Sri Lanka applying annual data during the period between 1990-2019 by engaging the ARDL bounds test and the Granger causality test. Economic growth is considered as a dependent variable whereas; defense expenditure, broad money supply, capital investment and exchange rate are considered as independent variables for this study. The findings revealed that defense spending has a significant and positive effect on economic growth in the long- run. Exchange rate, capital investment and broad money supply have a significant and positive influence in the short-run and long-run. Further, the output of the Granger causality confirms the one-way association between the growth of the economy and defense expenditure. The study suggests that government should concentrate more on human capital development rather than spending on defense.
Details
- ISSN :
- 23500530 and 23943629
- Volume :
- 9
- Database :
- OpenAIRE
- Journal :
- International Journal of Research -GRANTHAALAYAH
- Accession number :
- edsair.doi...........557a55b4d520a37cee0d9d498304d21b
- Full Text :
- https://doi.org/10.29121/granthaalayah.v9.i3.2021.3710