What is VECM

The debate regarding the relationship between military expenditure and economic growth especially in the context of developing countries is an old one. There is apparent conflict within government budgets between education expenditure and military expenditure. The military budget of the India is that part of budget allocated for the funding of the Indian armed forces. This military budget finances salaries of employees and training costs, maintenance of equipment and facilities, support of new or ongoing operations, development and procurement of new weapons, equipment, vehicles, etc. The chapter explores the relationship among GDP, military expenditure, and education expenditure in India. The time series analysis reveals that there is long-run causality running from education expenditure and military expenditure to GDP. The study also reveals that there is short run causality running from military expenditure to GDP.