Sovereign debt, deficits and defence spending: the case of Greece
Abstract
The outbreak of the sovereign debt crisis at the end of 2009 in Greece led to a severe recession, and constant economic problems. This paper investigates military expenditure among others as a potential factor to the growth of sovereign debt in Greece over the period 1960 until currently. Our empirical findings suggest that high deficits, inflation and military spending have been the primary causes of debt growth in Greece. The structural break models reveal a much higher effect of deficits and inflation in the post-1990 period while the threshold switching regression, based on the level of sovereign debt, indicate that for levels of debt-to-GDP ratio above 90% deficits, inflation and military expenditures had significantly more pronounced effects on government debt changes.Citation
Dimitraki O, Kartsaklas A (2017) 'Sovereign debt, deficits and defence spending: the case of Greece', Defence and Peace Economics, 29 (6), pp.712-727.Publisher
Taylor & FrancisJournal
Defence and Peace EconomicsAdditional Links
https://www.tandfonline.com/doi/abs/10.1080/10242694.2017.1289497Type
ArticleLanguage
enISSN
1024-2694ae974a485f413a2113503eed53cd6c53
10.1080/10242694.2017.1289497