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RESEARCH PRODUCT

Alternative Military Keynesianism as a Tool of Civil-Military Cooperation in the Framework of the EU Defence Policy

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During the last year the security threats to the European Union have increased dramatically under the influence of military crisis in eastern Ukraine and Islamic terrorist activities in Europe. Consequently the demand for defence in the member states of the European Union has become greater than in previous years.This situation leads to the dilemma when the high level of defence expenditure can hamper the financial support of other sectors of national economy.Therefore it is necessary to increase the efficiency of available financial resources that have been allocated for the defence without a significant increase in defence expenditure. In order to achieve this efficiency the concept of closer cooperation between military and civil sector can be the base for complex defence support measures that use the potential of national economy.Having regard to the above mentioned, the purpose of this study is to introduce the concept of civil-military cooperation that utilizes the main task of military Keynesianism (to stimulate industrial development and economic growth) and functions within the framework of Common Security and Defence Policy of the European Union. In order to analyse the concept the following tasks were set: 1) to modify the standard concept of military Keynesianism by the analysis of different theoretical sources;2) to identify the main advantages and deficiencies of the civil-military cooperation concept by the use of expert interview; 3) to set out the main conditions for the functioning of the civil-military cooperation concept by the use of cost-benefit analysis.The following primary qualitative and quantitative methods have been used in this research: 1) literature analysis that incorporates the study of theoretical works, research articles, as well as policy and legal documents;2) expert interview that has been conducted after the presentation of civil-military cooperation concept to the experts from the Ministry of Defence of the Republic of Latvia and Latvian National Armed Forces Joint Headquarters. 3) cost-benefit analysis of hypothetical implementation of the civil-military cooperation concept for ammunition manufacturing in the territory of the European Union.The research shows that the negative impact of the identified deficiencies of the civil-military cooperation concept can be significantly reduced by the use of effective legal framework and simple procedures of implementation.Also the main conclusion of the research is that under the pressure of the high demand for defence the member states of the European Union,which defence industrial base is small or non-existent (Poland, Baltic states et al.), can use the civil-military cooperation concept in order to attract the foreign manufacturers of military or dual-use goods by implementation of tax relief,as well as use of state infrastructure objects at a reduced price.