| Abstract:
The first part of this article, which is based on a review of literature on
defense economics, aims to introduce the most famous theories concerning
factors detennining military expenditure and the effects of such expenditures on
economic growth.
The writer attempts in the second part of the study to use possible
econometrical techniques in order to show the applications of these theories in
the Islamic Republic of Iran and offers the following analytical results:
1. with the change of the Monarchical regime into the Islamic Republic in Iran
the share of military expenditure in national economics has reduced
significantly;
2. the share of military expenditure in GNP has been positively correlated with
the relative importance of oil export, and
3. the share of military expenditure in GNP has had negative effect on the
countrys economic growth.
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