Indigenous Development or Buying Off-the-Shelf

Abstract

Escalating costs for new weapons development have caused concerns about costs in Government Treasury quarters across the industrial world and prompted a shift of military procurement programs, from indigenous development and manufacturing to off-the-shelf purchases. This has been so even in countries that have the requisite indigenous technological and industrial capacities to develop and manufacture innovative top-of-the-line weaponry for their own use at internationally competitive costs. Those countries, as we have shown, might therefore benefit handsomely from developing their own military technology both in the form of spillovers and through exports of sophisticated military equipment. The temporary post-Cold War thaw of the 1990s, however, created a belief that seriously effective weaponry was no longer needed and fostered a static cost minimizing off-the-shelf purchasing political mood. The bottom line belief has been that a peace dividend has become available for politicians to distribute elsewhere. Many countries canceled their weapons procurement plans and even allowed some of their military producers to close down. Denmark shut down its entire submarine defense, and Norway followed suit by opting out of the joint Danish, Norwegian, and Swedish Viking submarine project (Chap. 9). The Netherlands has allowed its previous in-house capacity to design and build its own submarines to slip.