Chapter 3 World military expenditures

Military expenditure is difficult to define. Major issues are functional versus institutional approaches to defense, indirect and intangible costs and benefits and current versus comprehensive accounting. Authoritative institutions have adopted standard definitions but national governments are free to use their own definitions. Specific inflation pressures complicate the creation of real time series of military expenditures. International comparisons are influenced by the choice of exchange rates. For some countries, no credible data are available. Data series on military expenditures and arms transfers must be used with caution as the publishing institutions have only limited resources to deal with the numerous conceptual and practical problems.