Defence Spending in the European Union

This paper provides an overview of defence spending, and a review of the literature on the role of defence in growth.

Highlights:

• As a matter of fact, defence policy in the EU remains an almost exclusive responsibility of the Member States.
• After years of underinvestment, almost all national budgets have boosted military spending in recent years and are planning to increase it even further in the future.
• The literature on the existence of a causal relationship between defence spending and economic growth is not unanimous. Although favourable impacts are more frequently reported in advanced economies than in less developed ones, the outcomes are dependent on the time horizon and on the methodology used.

Information and identifiers

Discussion Paper 199. April 2024. Brussels. PDF. 32pp. Tab. Graph. Bibliogr. Free.

KC-BD-23-016-EN-N (online)

ISBN 978-92-68-01817-0 (online)

ISSN 2443-8022 (online)

doi:10.2765/883426 (online)

JEL classification: H56, H77, O40

Disclaimer

European Economy Discussion Papers are written by the staff of the European Commission’s Directorate-General for Economic and Financial Affairs, or by experts working in association with them, to inform discussion on economic policy and to stimulate debate. The views expressed in this document are solely those of the author(s) and do not necessarily represent the official views of the European Commission.