Eastern Europe's economic contribution to Soviet defense

by Keith Crane

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The economic contribution of Eastern Europe to Soviet defense can be gauged through the consideration of a variety of factors. This paper discusses three such factors: (1) the value to the Soviet Union of East European military forces, estimated in terms of the ruble cost of equivalent Soviet troops; (2) the economic gain derived from exporting arms from the Soviet Union to Eastern Europe; and (3) the extent to which the Soviets benefit from technology transfer. The value of East European forces to the Soviet Union is sizable, equaling approximately 14 percent of annual Soviet defense expenditures. The importance of Eastern Europe in Soviet arms trade is more ambiguous. Eastern Europe is an important customer, but sales are small in relation to the Soviet Union's own procurement. Results of the analysis of technology transfer are similarly mixed; recent efforts to encourage such transfer may ultimately have significant effects, but these effects are not yet apparent.

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