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JSPES, Vol. 28, No. 3 (Fall 2003 )
pp. 275-293

Defense Expenditure and Economic Growth in the SAARC Countries

M. Kabir Hassan, Ph.D., M. Waheeduzzaman, Ph.D.. Aminur Rahman, Ph.D.

This paper examines growth empirics in the context of five of the seven South Asian Regional Cooperation Council (SAARC) nations with special emphasis on the impact of military expenditure on economic growth using a panel data over the 1980-1999 period. It sheds light on both theoretical and empirical evidence about the many ways macroeconomic policies affect growth. The author's results indicate that ICT infrastructure, FDI, GDP growth, human capital, population growth, globalization index, gross domestic investment, government expenditure, per capita income, exchange rates and military expenditure all appear to influence net inward FDI flows and economic growth. ICT infrastructure and its utilization deserve more study.