Open AccessMODELING AND FORECASTING OF INDIA’S DEFENSE EXPENDITURES USING BOX-JENKINS ARIMA MODEL
Author(s) -
Sohan Lal Sharma,
Sanju Karol
Publication year - 2021
Publication title -
international journal of research - granthaalayah
Language(s) - English
Resource type - Journals
eISSN - 2394-3629
pISSN - 2350-0530
DOI - 10.29121/granthaalayah.v9.i2.2021.3698
Subject(s) - autoregressive integrated moving average , box–jenkins , order (exchange) , government (linguistics) , demand forecasting , economics , rationality , operations research , public economics , time series , business , computer science , operations management , finance , engineering , political science , linguistics , philosophy , machine learning , law
Many developed and developing countries are at the core of the security and peace agenda concerning rising defense expenditure and its enduring sustainability. The unremitting upsurge in defense expenditure pressurizes the government to rationally manage the resources so as to provide security and peace services in the most efficient, effective and equitable way. It is necessary to forecast the defense expenditure in India which leads the policy makers to execute reforms in order to detract burdens on these resources, as well as introduce appropriate plan strategies on the basis of rational decision making for the issues that may arise. The purpose of this study is to investigate the appropriate type of model based on the Box–Jenkins methodology to forecast defense expenditure in India. The present study applies the one-step ahead forecasting method for annual data over the period 1961 to 2020. The results show that ARIMA (1,1,1) model with static forecasting being the most appropriate to forecast the India’s defense expenditure.