TY - JOUR
T1 - The effects of the world defense industry and US military aid to Israel on the Israeli defense industry
T2 - A differentiated products model
AU - Shefi, Yoad
AU - Tishler, Asher
N1 - Funding Information:
We are grateful to K. Kagan, O. Setter, the participants in the Eighth Annual Conference on Economics and Security at the University of the West of England and the University of Bristol, an anonymous referee and the editor of the journal for many valuable comments and suggestions. We thank the Economics of National Security (ENS) program at the Samuel Neaman Institute for Advanced Studies in Science and Technology, the Technion, for partial financial support.
PY - 2005/12
Y1 - 2005/12
N2 - This paper models the interactions between the defense industry market structure and the defense needs of Israel, the USA and Western Europe, which produce several heterogeneous defense goods. The model specifies that the defense industries of the US and Europe are 'large while that of Israel is 'small. The US military aid to Israel is also an integral part of the model. The results show that net defense costs of Israel are minimal when the number of its defense firms is one. The model predicts that an increase in US military aid reduces Israels government expenditure, its defense industrys profits and its net defense costs.
AB - This paper models the interactions between the defense industry market structure and the defense needs of Israel, the USA and Western Europe, which produce several heterogeneous defense goods. The model specifies that the defense industries of the US and Europe are 'large while that of Israel is 'small. The US military aid to Israel is also an integral part of the model. The results show that net defense costs of Israel are minimal when the number of its defense firms is one. The model predicts that an increase in US military aid reduces Israels government expenditure, its defense industrys profits and its net defense costs.
KW - Defense industry
KW - Industry profits
KW - Net defense cost
KW - Security levels
KW - US military aid
UR - http://www.scopus.com/inward/record.url?scp=29144474477&partnerID=8YFLogxK
U2 - 10.1080/10242690500167759
DO - 10.1080/10242690500167759
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AN - SCOPUS:29144474477
SN - 1024-2694
VL - 16
SP - 427
EP - 448
JO - Defence and Peace Economics
JF - Defence and Peace Economics
IS - 6
ER -