By Eric Mombeek
Jagdwaffe: Blitzkrieg and Sitzkrieg: Poland and France 1939-1940
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Extra info for Jagdwaffe: Blitzkrieg and Sitzkrieg, Poland and France 1939-1940 (Volume One Section 3)
A related factor is that expenditure on recurrent items, especially wages, is much less prone to change than 'development' expenditures. A perceived threat is met not principally by expanding the size of military forces, but by purchasing more sophisticated equipment, building bases etc. This often occurs after a period when development expenditures have been fairly steady. Whereas defence manpower is a more domestic expense, the purchase of new equipment usually has a high import component. Not only is defence in competition with other uses as regards government expenditure, but also with respect to foreign exchange.
International reserves (GIRB) are next in importance and, as expected, negative. By themselves (regressions without GOP), international reserves had a positive sign and were statistically significant when regressed on public external debt. Their negative sign when regressed together with GOP indicates that, when one corrects for the influence of other demand related variables, countries with high reserves tend to receive less external funds. 18 F Statistics 69 69 63 63 64 69 75 77 DF DF = degrees of freedom; F = F statistic; r2 = coefficient of determination; ( *) = t statistic.
Compared to the traditional contracting terms for foreign and/or public sector loans, international capital flows in the 1970s and early 1980s increasingly came with few strings attached to their use. 3 It is clear that for most LDCs a large part of the military equipment budget has to be spent on imported armaments. According to Stockholm International Peace Research Institute (SIPRI), weapons imports by LDCs rose from S 1559 million in 1965 to S10 450 million in 1980-all in constant 1975 prices.