On distinguishing the behavior of nuclear and non‐nuclear allies in NATO

Abstract

This paper views an alliance arsenal as producing joint outputs that vary in their degree of publicness. The purpose here is to subject the joint product model of alliance behavior to a direct test by the use of time series data that distinguish between strategic and non‐strategic (i.e. conventional and tactical) expenditure in the NATO alliance during the era of the doctrine of flexible response, 1970–1985. In particular, we estimate demand for military expenditure equations for a sample of seven non‐nuclear allies and the three nuclear allies, using gross domestic product, strategic spillins and conventional spillins as independent variables. Free‐riding behavior is seen to apply to purely public strategic spillins but not to conventional spillins, which have private and impure public benefits. Our methodology can be applied to a wide range of public good situations.