Determinants and economic effects of military expenditure in Kenya (1988-2005)
Abstract
The study looks at the determinants and economic effects of military expenditure in
Kenya (1988-2005), using both primary (interviews) and secondary sources of data. On
the whole, the expenditure patterns significantly resembled the global patterns during
the period. In particular, the expenditures declined as a percentage of gross domestic
product. Specifically, the expenditure declined drastically between 1988 and 1994
thereafter, fluctuated moderately, although however, it rose steadily in the new
millennium. The expenditures imposed considerable economic burden whose average
expenditure was 1.9 percent of the country's gross domestic product (GDP) or $ 7.2
military expenditure per capita in 2005. There was positive correlation between gross
domestic product growth and per capita spending. The expenditures have had both
positive and negative effects on the economy and which effects are more significant is
still a subject of debate as it has always been since pioneer work by Benoit's (1973,
1978) remains to be seen. For example, human and physical capital grew; foreign
exchange earnings rose; gross domestic product rose; stimulation of economic growth
through increased capacity utilization; job creation and others. Investment was
however, "crowded out". We recommend that the military should be subjected to strict
transparent and accountable budgetary accounting, and government wide expenditure
controls of procurement. Lastly, because of the high cost of the military burden and
associated effects, the future guarantee of long term security lies in the formulation of
non -violent means of conflict resolution.
Citation
Post Graduate Diploma In Strategic Studies To The Institute Of Diplomacy And International Studies, University Of Nairobi,2007Publisher
University of Nairobi School of economics, university of Nairobi