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by Giampietro Lea (Venetian Institute) - 
Abstract.
With the fall of the Berlin Wall and the collapse of the Soviet
Union, an increasing number of European countries decided
to abolish compulsory military service and move towards All
Volunteer Forces (AVF). Using data obtained from SIPRI, for
the period 1988-2009, this paper analyses whether the move
from conscription to volunteers resulted in a reduction in
the military expenditure of those countries which adopted
the AVF model. Results of the analysis show that most European
countries achieved a reduction in military expenditure in
the period under study whether or not they had abolished conscription.
The reduction in expenditure appears to be a long-term trend
triggered by the end of the Cold War.
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Conclusions and Further Study
The analyses carried out (time series, t-tests, correlation)
have shown that although there has been a reduction in military
expenditure, in the period 1988-2009, this reduction cannot
- in general - be ascribed to the AVF versus Conscription
choice.
The time-series graphs reveal clearly that reduction in expenditure
is common to both countries which moved to the AVF model (or
which already had it) and those which have decided to retain
conscription. The correlation analyses further confirm the
lack of correlation between change in expenditure and abolition
of conscription.
Although there are some localized regional exceptions (Caucasus,
Aegean and Baltic countries) the reduction in military expenditure
seems to be a long-term trend triggered by the end of the
Cold War, and with no apparent link to the abolition of conscription.
This downward trend appears now to have stabilised.
Expenditure for France, UK and Turkey is now (2009) at approximately
2.5% of GDP. Italy, Germany, Poland fluctuate between 1.5%
and 2% of GDP, while the remaining smaller countries (with
some exceptions - as mentioned) hover around the 1% mark.
Due to time constraints, it has not been possible to carry
out any initial - though superficial given the complexity
of the area - formulation of a possible predictor model for
military expenditure. This model would need to take into account
not only the non-stationarity of the data and the dependence
between yt and yt-n, but also the many independent (xi) non-financial
variables, such as: 1) size of the country, 2) local unemployment
rates, 3) ratio of Volunteers' wages to "equivalent"
market wages, 4) availability of job opportunities alternative
to a career in the Armed Forces, 5) draftees' deferment rates,
or uses in non-military roles, 6) conscripts' wages, 7) ratio
of personnel costs to equipment/infrastructure costs, 8) external
threats, etc.
Finally, this initial analysis has raised several questions
regarding some particular countries' military expenditure,
e.g. Greece and Armenia. It would be interesting to carry
out a detailed disaggregated analysis of their expenditure
along the lines used by Bove and Cavatorta (2010) in order
to understand what Armenia's aims are, or how Greece will
manage to keep such high levels of MilEx (3.2%) given its
current dire economic situation.
References
- Aaviksoo, J., (2010) Estonian Mandatory Conscription
Here to Stay, Baltic Report, (http://balticreports.com/?p=21416)
- Bove, V. and Cavatorta, E. (2010) From Conscription
to Volunteers: Budget Shares in NATO Defence Spending,
Birkbeck College, London
- CIA World Fact Book, (2011) https://www.cia.gov/library/publications/the-world-factbook.html
- Dunne, J.P., Alonso, M.G., Levine, P. and Smith, R.P.
(2005) The Evolution of the International Arms Industry.
- Knorr, K. (1985) Burden-sharing in NATO, Orbis
29:517-536.
- Oneal, J. R. (1991) The Monetary Value of Conscription,
Hoover Institution, Stanford University
- Poutvaara, P. and Wagener, A. (2009) The Political
Economy of Conscription, Discussion Paper
- SIPRI Military Expenditure Database (2011) http://www.sipri.org
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