The structure of the defense industry and the security needs of the country: A differentiated products model

Benny Mantin, Asher Tishler*

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

13 Scopus citations

Abstract

This paper models the interactions between the defense needs of the USA and Western Europe, which produce several heterogeneous defense goods, and the defense industry market structure. The results show that net defense costs of the USA and Europe are lower when the number of defense firms in each arms-producing country is small and when the world prices of the defense goods are high. The model predicts that the increase in world prices will crowd-out countries in the developing world from the market for modern weapon systems and may force them to develop and use 'cheap and dirty' weapon systems.

Original languageEnglish
Pages (from-to)397-419
Number of pages23
JournalDefence and Peace Economics
Volume15
Issue number5
DOIs
StatePublished - Oct 2004

Keywords

  • Defense industry
  • Industry profits
  • Net defense cost
  • Security levels

Fingerprint

Dive into the research topics of 'The structure of the defense industry and the security needs of the country: A differentiated products model'. Together they form a unique fingerprint.

Cite this