War finance

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War finance, a branch of defense economics, covers a number of measures - including fiscal and monetary initiatives - to fund the expenditure of a war. Such measures, broadly classified in three categories, may include:

Thus these measures may include levy of specific taxation, increase and enlarging the scope of existing taxation, raising of compulsory and voluntary loans from the public, arranging loans from foreign sovereign states or financial institutions, and also the creation of money by the government or the central banking authority.

Throughout the history of human civilization, from ancient times until the modern era, conflicts and wars have always involved raising of resources and war finance has remained, in some form or the other, a major part of any defense economy.

Funds are often raised with war bonds.

Loot and plunder - or at least the prospect of such - may play a role in war economies.[1][2]

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  1. ^ Capella Zielinski, Rosella (2016). How States Pay for Wars. Cornell University Press. ISBN 9781501706516. Retrieved 2016-09-13. When belligerents do resort to plunder, it only comprises a small percent of their war finance strategy. Only two states have financed more than 25 percent of their war by plunder, Germany during the First Schleswig-Holstein War and Chile during the Pacific War. 
  2. ^ Compare: Hall, Jonathan; Swain, Ashok (2008). "7: Catapulting Conflicts or Propelling Peace: Diasporas and Civil Wars". In Swain, Ashok; Amer, Ramses; Öjendal, Joakim. Globalization and Challenges to Building Peace. Anthem Studies in Peace, Conflict and Development Series. London: Anthem Press. p. 113. ISBN 9781843312871. Retrieved 2016-09-12. In the post-cold war conflicts, the belligerents [...] aim not to resolve conflict, but rather to sustain it, to take advantage of economic opportunities afforded by looting, rent seeking, taxing or siphoning off humanitarian aid and remittances, and by illicit trade.