Consequential Effects of Defence Expenditure on Economic Growth of Saudi Arabia: 1970-2012

  •  Mohammed Moosa Ageli    
  •  Shatha M Zaidan    


This study investigates the causality relationship between defence expenditures and Non Oil economic growth in Saudi Arabia over the period 1970-2012. Using Unit root tests, Johansen’s co-integration test and Granger Causality test. In this paper we found the existence of bi-directional causality relationship running from Non Oil-GDP to defence expenditure. The results show that, in Saudi Arabia, the model of defence expenditure is found to hold for Non Oil-GDP.

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