The relationships between renewable energy, net energy imports, arms exports, military expenditures, and CO2 emissions in the USA.

Abstract

We evaluate the relationships between renewable energy consumption, net energy imports, military expenditures, arms exports, gross domestic product, and carbon dioxide emissions by using annual data about the USA. The autoregressive distributed lag approach and the vector error correction model are used. There are both long-run and strong causalities running from all considered variables to renewable energy consumption. In addition, we have a short-run causality running from net energy imports to renewable energy consumption. We show that arms exports have a positive long-run effect on both renewable energy consumption and net energy imports. Military expenditures have a positive long-term effect on renewable energy consumption, but they have a negative long-term effect on both net energy imports and CO2 emissions. This study shows that the military sector is contributing to using renewable energy and combatting global warming in the USA. We recommend increasing the R&D budget of the US Department of Defense allocated to innovations in renewable energies.