ABSTRACT
In many ways, economic and social development are functions of each other; continued progress in either field depends upon concurrent gains in the other. In the development literature, expenditures in education and public health, for example, are labeled social overhead capital. The considerations explain the paramount focus of the author analysis – particularly with respect to Third World countries – upon social indicators of well-being. Considerable diversion of funds to administrative costs including salaries and corruption as well as differential efficiency suggest that financial expenditure indicators may be poor measures of actual welfare outputs, let alone outcomes. Only on child mortality is there a strong relationship with military burdens for the more developed category. In the least developed countries then, high military burdens in the late 1960s do not appear to be associated with low physical welfare levels in the mid to late 1970s.
