The Relationship Between Military Expenditure And Economic Growth Of Brics Countries

This study is conducted to examine the relationship between military expenditure and economic growth of the BRICS countries. This study uses the annual time series data of military expenditure, real GDP and real GDP per capita from 1974 to 2010 for China, India and South Africa, from 1988 to 2012 for Brazil and from 1989 to 2012 for Russia. The methodologies applied to study this relationship are the Augmented Dickey-Fuller (ADF) test, the Phillips-Perron (PP) test, the Johansen-Juselius Cointegration test, and VEC Granger Causality test. The results from the tests show that the variables for all countries are integrated of order I(1), and there are cointegrated vectors for all countries except for Brazil. Besides that, the existences of causal relationships were identified for all countries except for Russia and Brazil. Based on the results obtained, several policy implications were recommended and recommendations were also provided for future studies