Despite the vast number of studies of the guns-butter trade-off, we still do not know whether guns come at the expense of butter. In this article we attempt to clarify some of the major conceptual, measurement and statistical problems associated with this line of research

Multicollinearity is one of the major methodological problems in the study of the guns‐growth trade-off. In this paper, we use ridge regression to separate the effects of individual variables influencing economic growth in the United States. Ridge is not a new method, but to the best of our...

Studies of the guns versus butter trade-off found no evidence for the existence of a trade-off in the pre-Reagan era (see Russett 1982; Domke, Eichenberg, and Kelleher 1983; Mintz 1989). This study extends prior research by examining not only the direct, immediate effects of defense spending but also...

In a series of articles published in the Fall 1990 issue of Defence Economics Alexander (1990), Atesoglu and Mueller (1990) and Huang and Mintz (1990) have all specified and empirically estimated defence‐growth models based on a neoclassical production function. We now isolate the externality...

Despite the vast number of studies of the guns-butter tradeoff, we still do not know whether guns come at the expense of butter. In this article we attempt to clarify some of the major conceptual, measurement and statistical problems associated with this line of research. Copyright 1992 by The...