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Buy German Arms, Get Foreign
Aid Free!
Austin Baker
Abby Cooner
Prof. Vreeland
Krogh Honors Seminar
Research Question
Independent Variable
German Arms
Exports
Dependent Variable
German
Foreign Aid
The Global Arms Trade
• Eclectic Buying Patterns
• Highly Competitive
• Buyer’s Market
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
Receives
Aid
Export
Permits
Buys
Arms
German Arms
Manufacturers
Federal Security
Council
Chancellor
Bundestag
BDSV
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 Germany
Level of German Arms Imports
UNSC Member
Pariah state
War
ln(GDP per capita, real)
Political regime
U.S. Military Assistance (Const. 2011 dollars)
Number of observations
R-squared
0.01**
(2.36)
0.76**
(2.13)
-1.79
(0.99)
-0.81
(1.37)
-0.03
(0.02)
0.06
(0.86)
0.09**
(2.31)
1121
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
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