Determinants of Arms Production in the Third World: a Time-series Cross-section Analysis

Major determinants of third world military industrialization operate at the domestic, regional, and global levels. I examine the relative importance of these by analyzing time-series cross-section data for the twelve leading third world arms producers from 1968 to 1990. Arms production depends the state’s industrial capacity and is enhanced by the state’s capacity to produce weapons for export. It is affected by the closedness of political and governmental institutions, and thus the military’s potential influence in the allocation of resources, and by the actual allocation of resources in the form of military spending. States are motivated to pursue military industrialization programs by their involvement in regional conflict and the level of regional militarization. These too have a measurable impact on domestic arms production. The transfer of military technology in the form of arms imports affects domestic arms production overall; disaggregating, it is clear that technology transfer necessary for indigenous weapons production is accomplished in large part by licensing arrangements. Both arms imports and licensing might also be a vehicle for the diffusion of global military culture, but a crude indicator of state interaction fails to provide any independent confirmation. The global diffusion of military iconology as a driving force behind military industrialization is an important notion in my view, and represents a major challenge for systematic empirical research.