The Political Economy of Rising Defense Costs
This article appeared in the Spring 2024 issue of The Independent Review.
This essay employs public choice theory to explain the drivers of rising defense costs. Key sets of actors, including politicians, bureaucrats, and defense contractors, have incentives to capture private benefits associated with defense spending. But there are weak incentives to cut costs such that the individuals seeking to maintain spending in areas that do not contribute to defense win out, contributing to the observed rising costs.
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