Centrality in Trade Networks and Investment in Security

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The contemporary empirical literature on military spending has focused on institutional and conflict factors, and although has acknowledged the role of trade openness, it has not taken into account the position of a state in the trade network. Building on the concept of network centrality, we claim that the structure of trade networks affects the optimal investment in security, and that a country’s level of military spending is a function of its strategic position in the global network of a critical commodity, such as oil. Our empirical results show that network centrality constrains military spending.

Keywords

  • military spending, trade, network
Original languageEnglish
JournalPeace Economics, Peace Science and Public Policy
Volume22
Issue number1
DOIs
Publication statusPublished - 9 Dec 2015
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