| Weapons Procurement
and Development: Do Offsets Mitigate or Magnify the Military Burden? Abstract |
|
Lloyd J. Dumas |
| The offer of an offset package as part of a weapons procurement deal is clearly intended primarily as a marketing tool, not as a means of encouraging development. But whatever the motive for offering such a package, it is important to ask what effects, positive and negative, intended or unintended, the offsets are likely to have on the process of economic development in the procuring nation. Considering first the impact of military spending (and military production) on real economic development, the analysis will then focus on the extent to which "direct" offsets that involve co-production agreements magnify or mitigate this impact. The likely impact on development of alternative designs involving "indirect" offset packages --- agreements by the weapons sellers to purchase materials, goods or services unrelated to weapons production --- will then be compared to that of direct offset packages. Finally, in the light of the preceding analysis, there will be a discussion of the ways in which the availability and design of offsets should inform the level of weapons spending or the type of weapons procured, from the point of view of achieving economic development goals. |