Titlebook: Defense Economics; An Institutional Per Marcus Matthias Keupp Textbook 2021 The Editor(s) (if applicable) and The Author(s), under exclusiv

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Efficiency of Military Performance,is creation is. An efficiency assessment analyzes only the production side and makes no conclusions about the effectiveness of the capabilities. As a result, a full assessment of military performance must consider both its effectiveness and its efficiency.

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Introduction: The Fundamental Economic Problem of the Military,-market principles administer them. Quite the contrary: As these bureaucracies control all economic activity in the armed forces, a planned economy system is established. Any economic analysis that ignores this fundamental problem not only leads to false conclusions, but also to irrelevant policy re

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Institutions and Armed Forces,ces to satisfy a short-term demand for military force and disbanded them once they had accomplished their mission. Today, those who have political power in the state create a (or maintain an existing) armed forces organization that exists .. Without this institutional legitimization, armed forces co

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Effectiveness of Military Performance,tive military performance. Only real conflicts allow the armed forces to test the effectiveness of any military capabilities they have generated in the past. Just like a private firm does not know actual turnover until shops report sales figures, information about the effectiveness of military confl

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Opportunities for Reform,an alternative one (Buchanan and Tullock 1962; Buchanan 1990). A military organization can try to implement reforms within the planned economy system, or it can abandon this system and adopt an alternative instead. However, reforms within a planned economy system are possible only to a limited exten

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