Buy German Arms, Get Foreign Aid Free!

Austin Baker Abby Cooner

Prof. Vreeland Krogh Honors Seminar

The Global Arms Trade• Eclectic Buying Patterns• Highly Competitive• Buyer’s Market

Research Question

German Arms

Exports

German Foreign Aid

Independent Variable Dependent Variable

Hypothesis

• If a country imports German arms, they are more likely to receive German foreign aid.

How does this make sense?

The Process

Foreign Country

German Arms Manufacturers

Federal Security Council

Chancellor

Bundestag

Buys Arms

Receives Aid BDSV

Export Permits

Methodology

• Stockholm International Peace Research Institute (SIPRI)–Arms transfers database

• OECD Data (Vreeland, et. al.)• Adapted from “Model 5”–Country and year fixed-effects–1989-2009

Effect of German Arms Imports on Bilateral Aid received from GermanyLevel of German Arms Imports 0.01** (2.36)UNSC Member 0.76** (2.13)Pariah state -1.79 (0.99)War -0.81 (1.37)ln(GDP per capita, real) -0.03 (0.02)Political regime 0.06 (0.86)U.S. Military Assistance (Const. 2011 dollars) 0.09** (2.31)Number of observations 1121R-squared 0.31

Conclusion

• Arms market: extremely competitive• Small impact, statistically significant• Causal logic reinforced by data

Future Work

• Expand control variables• Lagging data• Case studies• Deeper understanding of German government

and German lobbying practices