Nonlinear economic growth dynamics in the context of a military arms race

Daniel Metz, Adrian Viorel


In the present contribution, we propose and analyze a dynamical economic growth model for two rival countries that engage an arms race. Under natural assumptions, we prove that global solutions exist and discuss their asymptotic long-time behavior. The results of our stability analysis support the recurring hypothesis in Cold War political science that engaging in an arms race with a technologically superior and hence faster growing adversary has damaging economic consequences. Numerical findings illustrate and support our claims.


Solow-Swan model, Arms race, Asymptotic behavior

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