Abstract
As geopolitical instability increases and new threats emerge, a number of countries are increasing their respective allocations for defence expenditure in order to take greater responsibility for their citizens in terms of defending and protecting their values and way of life. Small states such as Lithuania, Latvia, and Estonia must evaluate certain economic, political, and strategic factors when increasing their respective defence expenditure. While they do tend to increase expenditure on national defence matters, budgetary constraints often force them to cut funding in some civilian domains or to increase their borrowing on international markets. Therefore, the security and defence of small states must be addressed in an integrated way, taking into account economic, social, and environmental factors. The aim of this article is to assess the relationships between defence expenditure and sustainable development indicators during the period between 2000 and 2018 in the Baltic states. The authors of this article aimed to determine which sustainable development indicators have a significant impact upon a country’s expenditure when it comes to defence matters. The study was conducted using econometric methods, including Spearman’s correlation analysis and Automatic Linear Modelling (ALM). The research results revealed some differences amongst the Baltic countries. In Lithuania, the employment rate and R&D personnel as a share of the active population demonstrated a significant impact upon defence expenditure. In Latvia, defence expenditure was found to be affected by disposable household income per capita and environmental taxes as a share of total tax revenue. In Estonia, defence expenditure was mainly influenced by disposable household income per capita and energy import dependency. The study’s findings may be used to ensure both the security of the country and the implementation of the Sustainable Development Goals.
Highlights
As has been mention above, this study focussed on the relationship between defence expenditure and sustainable development indicators
The investigations were performed by the IBM SPSS 27v software and research results focus on the variability of defence expenditure in the 2000–2018 period in three Baltic states as follows: Lithuania, Latvia, and Estonia, with those results presented below in Section 4.1, Section 4.2, and Section 4.3, respectively
Over the last six years, the budgets of the small states of Lithuania, Latvia, and Estonia have demonstrated an annual increase in military spending and the implementation of political commitments to NATO by way of ensuring 2% of funding for national defence
Summary
Academic studies have approached the area of defence expenditure in order to analyse it within the context of sustainable development, by consulting various perspectives, such as military spending and economic growth [1,2,3,4,5], defence and inequality [6,7,8,9,10,11], military and social welfare [12], and military and unemployment [13,14], as well as military and energy consumption [15]. By being enabled through the modern conditions which revolve around globalisation, the development of European integration determines the transformations that are required to take place within. European society by developing sustainable economic, social, cultural, technological, and environmental processes, as well as by ensuring safe and free living conditions. The EU and NATO address mutual security questions and, in turn, serve mutual defence interests. With regard to the majority of EU member states, it should be noted that defence in Europe
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