By Charles Wolf

Will the ecu Union have the assets to improve the services of the quick response strength within the coming decade?

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Additional resources for European Military Prospects, Economic Constraints, and the Rapid Reaction Force (2001)

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S. 4 billion [= (65,400)(60,000)(8)]. These estimates implicitly assume procurement and RDT&E costs for the ESDP force that would constitute entirely new outlays, excluding any allowance for existing procurement and RDT&E levels in the four countries. S. 2000 dollars. We have made no allowance for these ongoing military investments, on the basis of the arguable premise that much of these outlays would continue without contributing appreciably to the high-technology, advanced new systems that the rhetoric accompanying the ESDP/RRF implies.

In principle, these resources could contribute to meeting the capital costs of the ESDP/RRF, as well as commitments already made within NATO under the DCI, if the share of GDP allocated to military spending remained constant while little or no reallocation within the existing patterns of military investments was actually realized. To the extent that appreciable reallocations from existing and planned military investments in each of the countries can be accomplished, the problem of providing resources to finance high-technology equipment for the ESDP force would be substantially eased.

The model, summarized below, was used for each country, together with adjustments and elaboration to allow for data problems or other country-specific circumstances. Q = (e τt ) • Lα • K (1 − α ) (1) MSt = γ GDP (2) MIt = πMSt (3) where Q = GDP τ = rate of technological change (total factor productivity) t = years covered in the projections, beginning with 1994 α = labor share in GDP L K MSt = labor input in each year = capital input in each year = military spending in year t γ = proportion of GDP devoted to military spending MIt = military investment in year t π = proportion of military spending devoted to procurement of equipment and RDT&E Model and Method 43 In Equation (1), the civil capital inputs (K) and labor inputs (L), along with their corresponding growth rates, were estimated for each country.

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