The “new” military and income inequality: A cross national analysis

Military expenditures have escalated over the last three decades in both developed and less developed countries, without a corresponding expansion of military personnel. Spending has instead been directed towards hi-tech weaponry, what we refer to as the “new” military. We hypothesize that this new, increasingly capital-intensive military is no longer a pathway of upward mobility or employer of last resort for many uneducated, unskilled, or unemployed people, with significant consequences for those individuals and society as a whole. One such consequence, we argue, is an increase in income inequality. We test this hypothesis with cross-national panel models, estimated for 82 developed and less developed countries from 1970 to 2000. Findings indicate that military capital-intensiveness, as measured by military expenditures per soldier, exacerbates income inequality net of control variables. Neither total military expenditures/GDP nor military participation has a significant effect. It appears from these findings that today’s “new” military establishment is abrogating its historical role as an equalizing force in society, with important policy implications.

► We examine the cross-national relationship between income inequality and military expenditures.
► Military expenditures per soldier increases domestic income inequality, net of various controls.
► The impact of the world’s militaries on income distributions within nations has changed through time.