Abstract:
This empirical note re-examines the causal linkages between military expenditures and
economic growth for the BRICS countries (Brazil, Russia, India, China, and South Africa) and
that for the USA during the period 1988-2012. Results of Granger causality tests show that
military expenditures influence economic growth in the United States, economic growth
influence military expenditures in both Brazil and India, a feedback between military
expenditures and economic growth in Russia, and no causal relation exists between military
expenditures and economic growth in China and South Africa. The findings of this study can
provide important policy implications for the BRICS countries and also for the United States.
