Volume 6, Issue 3

In this paper, Kenneth Arrow provides a general framework for analysis by economists of the forces lying behind the deescalation and escalation of military expenditures. On the basis of his long experience and leadership in the development of economic theory, he addresses the question: what are the ways suggested by such theory for estimating the economic effects of a major reduction of current arms expenditure, particularly with reference to the United States? (eds.)

For this paper there was not available nearly as much empirical materials for analysis and model construction as was the case for the authors’ Guatemala study cited in this paper. However, for developing countries very deficient in data this paper importantly demonstrates how useful results can still be obtained on the possible impacts of reduced military expenditures. (eds.)

This statement supplements the rationale of the 1997 Isard/Azis proposal1 to initiate a resolution of the then current bitter conflict between North and South Koreas. The proposals and initiatives of the U.S., Japan, other nations and the U.N. had reached a stalemate. The Isard/Azis proposal pertained to a very small cooperative effort between North Korea and South Korea. It involved a small economic development within (or close by) the far eastern section of the DMZ (Demilitarized Zone) lying within North Korea.