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golkhandan, A., Mohammadian Mansour, S. (2024). The Asymmetric Impact of Global Geopolitical Risk on Defense Spending in Iran in the Form of VECM Model. Electronic and Cyber Defense, 33(127), 152-121.
abolghasem golkhandan; Sahebe Mohammadian Mansour. "The Asymmetric Impact of Global Geopolitical Risk on Defense Spending in Iran in the Form of VECM Model". Electronic and Cyber Defense, 33, 127, 2024, 152-121.
golkhandan, A., Mohammadian Mansour, S. (2024). 'The Asymmetric Impact of Global Geopolitical Risk on Defense Spending in Iran in the Form of VECM Model', Electronic and Cyber Defense, 33(127), pp. 152-121.
golkhandan, A., Mohammadian Mansour, S. The Asymmetric Impact of Global Geopolitical Risk on Defense Spending in Iran in the Form of VECM Model. Electronic and Cyber Defense, 2024; 33(127): 152-121.

The Asymmetric Impact of Global Geopolitical Risk on Defense Spending in Iran in the Form of VECM Model

سیاست دفاعی
Volume 33, Issue 127, August 2024, Pages 152-121    PDF (1.47 M)
Document Type: Original Article
Authors
abolghasem golkhandan* 1; Sahebe Mohammadian Mansour2
1Ph.D. of Public Sector Economics, School of Economics and Administrative Sciences, Lorestan University, Khoram Abad, Iran
2Assistants Professor, Department of Economics, Payame Noor University, Tehran, Iran
Receive Date: 18 January 2023,  Revise Date: 05 February 2023,  Accept Date: 02 October 2024 
Abstract
Global geopolitical risk indicates geopolitical tensions and events that are a serious threat to global security and peace. Most countries in the world react to this issue by increasing defense spending. The importance of this issue for the countries of the Middle East region is twofold; Because this region plays an important role in global geopolitical risk. Based on this, in the current research, the short-term and long-term asymmetric effects of global geopolitical risk on Iran's defense spending have been investigated using a neoclassical model and annual data for the period of 1985-2021. For this purpose, first, the positive and negative impulses of global geopolitical risk have been extracted with the help of Granger and Yoon method. Then, using the Johansen-Juselius cointegration test, the existence of an asymmetric long-term equilibrium relationship has been confirmed; Finally, the Vector Error Correction Model (VECM) has been used to measure these asymmetric effects. The findings of this research show that in the short and long term, the positive impulses of the global geopolitical risk have increased defense spending and its negative impulses have decreased defense spending. But the increasing effect of positive global geopolitical risk impulses is greater than the decreasing effect of its negative impulses (confirming the asymmetric effect). According to other research results, Israel's defense spending has been the most important factor in increasing Iran's defense spending in the long term, and Saudi Arabia's defense spending has been the most important factor in increasing Iran's defense spending in the short term.
Keywords
Global Geopolitical Risk; Defense Spending; Neoclassical Model; Asymmetric; Security
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