TY - JOUR
T1 - The structure of the defense industry and the security needs of the country
T2 - A differentiated products model
AU - Mantin, Benny
AU - Tishler, Asher
PY - 2004/10
Y1 - 2004/10
N2 - 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.
AB - 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.
KW - Defense industry
KW - Industry profits
KW - Net defense cost
KW - Security levels
UR - http://www.scopus.com/inward/record.url?scp=4744345399&partnerID=8YFLogxK
U2 - 10.1080/1024269042000219323
DO - 10.1080/1024269042000219323
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AN - SCOPUS:4744345399
SN - 1024-2694
VL - 15
SP - 397
EP - 419
JO - Defence and Peace Economics
JF - Defence and Peace Economics
IS - 5
ER -