US Military Spending---International Comparisons

Introduction

The graphs, tables, and charts below depict the recent trends in the size of US military spending compared to that of the rest of the world. Comparisons made include

• US military spending as a percentage of world military spending (see Graph 1, Table 1, Graph 2, Table 2);
• rankings of countries by military expenditures (see Chart 1, Chart 3, Chart 4, Chart 5), and Chart 7); and,
• a comparison of US military spending and that of potentially hostile nations (see Chart 2, Chart 6, and Chart 8).

Because of the difficulty in collecting military expenditure data for many countries, multiple sources of public data are used:

• "World Military Expenditures and Arms Transfers," a series of annual reports produced by the US government,
• the Stockholm International Peace Research Institute,
• the CIA's World Factbook 2003, and
• IISS's The Military Balance: 2002--2003.

Many caveats should be kept in mind when making international comparisons of military expenditures:

• "Military spending is not identical to military strength." ([4])
• Data for developing and nondemocratic countries may be incomplete, which may lead to crude estimates or underestimates of military spending. (See reference [8] for further discussion.)
• Conversions from local currencies to a common currency (here, US dollars) may lead to misleading comparisons of the spending of different nations. Currency conversions can be done using official (or market) exchange rates or with "purchasing power parity" (PPP) (which is an alternative exchange rate that attempts to more realistically reflect the actual value of a currency in terms of the goods and services that it can purchase). The data sources used below differ in their decisions of whether and when to use PPP rates, which explains some of the discrepancies between the numbers presented using the sources. (Note the differences in rankings generated using market versus PPP exchange rates in Chart 3 and Chart 4. See references [8] and [1] for further discussion.)
• The previous two caveats imply that estimates of world military spending must also be treated with caution.

The list of "potential enemies" used in some of the charts below was taken from [4] and originally defined by the US Department of Defense.

Data from "World Military Expenditures and Arms Transfers"

"World Military Expenditures and Arms Transfers," or WMEAT, is an annual originally published by the US Arms Control and Disarmament Agency. It is now published by the Bureau of Verification and Compliance of the US State Department.

Note that the three data series presented here are not in exact agreement for those years in which their coverage overlaps. This is because world military expenditures were subsequently reestimated in later data series.

Graph 1: US military spending as a percentage of world military spending, 1985--1999 (from "World Military Expenditures and Arms Transfers" (WMEAT))

Notes

• While the US spending data in the three editions of WMEAT are essentially identical (where they overlap), the estimates of world military spending differ. This results in the three curves (each plotted in a different color) being distinct.
• The steep increase from 1991 to 1992 in US military spending as a fraction of world military spending resulted from both an increase in nominal (i.e., not inflation adjusted) US spending as well as a decrease in nominal world spending. (See Table 1 below.)

Data sources

Data underlying the series from 1985--1995, labeled "WMEAT 1996" (curve shown in red), were obtained from reference [10]. Data underlying the series from 1987--1997, labeled "WMEAT 1998" (curve shown in blue), were obtained from reference [11]. Data underlying the series from 1989--1999, labeled "WMEAT 1999--2000" (curve shown in black), were obtained from reference [12].

Table 1: US military spending as a percentage of world military spending, 1985--1999 (data from WMEAT)

Notes

• The numbers shown for US and world military spending are in billions of US dollars. They are not adjusted for inflation.
• To simplify the presentation, the figures for US military spending from the three editions of WMEAT surveyed here have been merged into one, since they agree almost exactly where they overlap.
• The figures for US spending as a percentage of world spending were not obtained directly from the data sources, but rather by dividing the US figure by the world figure.
• "NA" means no data available for that year and that dataset.

Data source

The data in Table 1 are the same as those underlying Graph 1.

Chart 1: Top 15 nations, as ranked by military spending in 1999 (data from WMEAT)

Notes

The numbers shown for national military spending are in billions of US dollars. They are not adjusted for inflation.

The numbers above have certain caveats attached, as indicated by the coded parenthetical notes. (The text of the following notes are taken from the data source, [12].)

• (E): Estimate based on partial or uncertain data
• (P): Value data converted from national currency at estimated purchasing power parity
• (R): Rough estimate

Data source

The data for Chart 1 were obtained from reference [12].

Chart 2: US and some potential enemy nations, as ranked by military spending in 1999 (data from WMEAT)

Notes

The numbers shown for national military spending are in billions of US dollars. They are not adjusted for inflation.

The numbers above have certain caveats attached, as indicated by the coded parenthetical notes. (The text of the following notes are taken from the data source, [12].)

• (e): Major share of total mil expenditures believed omitted, probably including most expenditures on arms procurement
• (E): Estimate based on partial or uncertain data
• (NA): Data not available
• (P): Value data converted from national currency at estimated purchasing power parity
• (R): Rough estimate

Data source

The data for Chart 2 were obtained from reference [12].

Data from SIPRI

SIPRI is the Stockholm International Peace Research Institute.

Graph 2: US military spending as a percentage of world military spending, 1988--2002 (data from SIPRI)

Notes

• The year indicated is a calendar (not fiscal) year.
• US spending as a percentage of world spending is not given for 1991, because the figure for world expenditures does not include Soviet/Russian military spending for that year.

Data sources

The data for Graph 2 are from [13] and [15] for world military expenditures and [7] for US military expenditures.

Table 2: US military spending as a percentage of world military spending, 1988--2002 (data from SIPRI)

Notes

• The numbers are in billions of US dollars, deflated to 2000 price levels.
• The year indicated is a calendar (not fiscal) year.
• US spending as a percentage of world spending is not given for 1991, because the figure for world expenditures does not include Soviet/Russian military spending for that year.

Data source

Data for Table 2 are derived from the same sources used for Graph 2.

Chart 3: Top 15 nations, as ranked by military spending in 2002 using market exchange rates (data from SIPRI)

Notes

• The numbers are in billions of US dollars, deflated to 2000 price levels.
• Market exchange rates are used for currency conversions.
• For Iran, the data source uses 2001 data instead of 2002 data, and claims this should not affect the rankings. (See [1].)

Data source

The data for Chart 3 were obtained from reference [1].

Chart 4: Top 15 nations, as ranked by military spending in 2002 using PPP exchange rates (data from SIPRI)

Notes

• The numbers are in billions of US dollars, deflated to 2000 price levels.
• PPP exchange rates are used for currency conversions. (See the introduction above for a brief discussion of PPP exchange rates.)
• For Iran, the data source uses 2001 data instead of 2002 data, and claims this should not affect the rankings. (See [1].)

Data source

The data for Chart 4 were obtained from reference [1].

Data from the CIA's "World Factbook 2003"

Chart 5: Top 15 nations, as ranked by military spending (data from the CIA's "World Factbook 2003")

Notes

• The numbers are in billions of US dollars. There is no indication in the source of the data that the numbers have been deflated (e.g., for inflation).
• There is no data for Russia in the source; hence, it does not appear in the rankings.
• The parenthetical notes indicate the period expenditures were made. "FY" refers to the country's fiscal year. "Est." means the figures are estimates only.

Data source

The data for Chart 5 were obtained from reference [6], with additional information coming from individual country profiles in reference [14].

Chart 6: US and some potential enemy nations, as ranked by military spending (data from the CIA's "World Factbook 2003")

Notes

• The numbers are in billions of US dollars. There is no indication in the source of the data that the numbers have been deflated (e.g., for inflation).
• There is no data for Cuba in the source.
• The parenthetical notes indicate the period expenditures were made. "FY" refers to the country's fiscal year. "Est." means the figures are estimates only.
• The data source states that the expenditure figure for Syria is "based on official budget data that may understate actual spending."

Data source

The data for Chart 6 were obtained from reference [3], with additional information coming from individual country profiles in reference [14].

Data from IISS's "The Military Balance, 2002--2003"

"The Military Balance" is an annual publication of IISS (the International Institute for Strategic Studies).

Chart 7: Top 15 nations, as ranked by military spending in 2001 (data from IISS's "The Military Balance, 2002--2003")

Notes

• The numbers are in billions of US dollars, deflated to 2000 price levels.
• The note (e) means the figure is an estimate; (PPP) means the figure is based on PPP exchange rates.
• Additional notes (see [5]):
  • Brazil and India: figures include spending on paramilitaries
  • China: figure "includes extra-budgetary military expenditures"
  • Iran: figure "excludes defence industry funding"
  • Taiwan: figure "includes special appropriations for procurement and infrastructure amounting to US$11B, 1993--2001"

Data source

The data for Chart 7 were obtained from reference [9], with additional information coming from individual country entries in reference [5]. (See also the discussion in [2].)

Chart 8: US and some potential enemy nations, as ranked by military spending in 2001 (data from IISS's "The Military Balance, 2002--2003")

Notes

• The numbers are in billions of US dollars, deflated to 2000 price levels.
• The note (e) means the figure is an estimate.
• Additional note (see [5]): the figure for Iran "excludes defence industry funding"

Data source

The data for Chart 8 were obtained from reference [9], with additional information coming from individual country entries in reference [5]. (See also the discussion in [2].)

References

[1]	SIPRI, "The 15 Major Spender Countries in 2002"
[2]	"Defence economics," in IISS, The Military Balance: 2002--2003 (2002), London, pp. 10--11
[3]	"Field listing---military expenditures---dollar figure," in Central Intelligence Agency, The World Factbook 2003 (December 18, 2003)
[4]	"Global military spending comparisons," in Center for Defense Information, "2001--2002 Military Almanac", p. 39
[5]	"Part II: defence economics," in IISS, The Military Balance: 2002--2003 (2002), London, pp. 240ff
[6]	"Rank order---military expenditures---dollar figure," in Central Intelligence Agency, The World Factbook 2003 (December 18, 2003)
[7]	SIPRI, "The SIPRI Military Expenditure Database" (2003) (database)
[8]	"Statistical notes," in Bureau of Verification and Compliance, World Military Expenditures and Arms Transfers: 1999--2000 (June 2002), pp. 193--200
[9]	"Table 26: international comparisons of defence expenditure and military manpower, 1985, 2000 and 2001," in IISS, The Military Balance: 2002--2003 (2002), London, pp. 332--337
[10]	"Table I: military expenditures, armed forces, GNP, central government expenditures and population, 1985--1995, by region, organization, and country," in US Arms Control and Disarmament Agency, World Military Expenditures and Arms Transfers: 1996 (July 1997), pp. 49--99
[11]	"Table I: military expenditures, armed forces, GNP, central government expenditures and population, 1987--1997, by region, organization, and country," in Bureau of Verification and Compliance, World Military Expenditures and Arms Transfers: 1998 (April 2000), pp. 61--112
[12]	"Table I: military expenditures, armed forces, GNP, CGE, population, and their ratios, by group and country, 1989-1999," in Bureau of Verification and Compliance, World Military Expenditures and Arms Transfers: 1999--2000 (June 2002), pp. 51--101
[13]	SIPRI, "World and Regional Military Expenditure Estimates,1993--2002" (June 17, 2003)
[14]	Central Intelligence Agency, The World Factbook 2003 (December 18, 2003)
[15]	Worldwide military expenditures for 1988--1992 are from the SIPRI Project on Military Expenditures and Arms Production and were made available by request (March 9, 2004)