We examine the presence of budgetary trade-offs between defence spending and welfare expenditure in the case of Greece, the country with the highest defence burden in the European Union. The findings reported herein point to a positive trade-off between education, social expenditure and defence.

Greece has regularly been ranked as the country with the highest defence burden in NATO and the European Union. This study, using an error-correction approach, is a preliminary empirical investigation into the economic effects of military spending in Greece during the period 1963-90.