Evasion costs and the theory Of conscription

Abstract

Many countries of Europe are moving from conscripted to volunteer military forces. This paper examines the current status of those conversions and interprets them in light of an economic model of the military manpower procurement system choice developed in Warner and Asch (1996). The theoretical model is expanded to include the social costs of individuals’ attempts to evade conscription and the government's cost of preventing it. Differences in evasion costs may be a significant factor in some European countries’ decisions to keep conscription and other countries’ decisions to end it.

Keywords:

• JEL Codes: H21, H56, J31, J33, J38, J45

Notes

By allowing for productivity differences between conscripted and volunteer forces, and therefore differences in force sizes, the Warner–Asch analysis was more complete than the Lee–McKenzie and Ross analyses, which were developed in a one‐service‐period framework and assumed equally sized, but not equally capable, forces.

An earlier version of this paper was presented on 16 June 2004 at the NATO Symposium Building Military Capability the Transformation of Personnel Policies in Brussels, Belgium. We thank Curt Gilroy and Cindy Williams for their comments on that version of the paper. Special thanks go to Jim Hosek and Keith Hartley for comments that substantively improved the current version of the paper. We alone are responsible for any remaining errors.

Sherwin Rosen once asked the senior author what determines the level of military pay under conscription; at the time he did not have a good answer.

See Warner et al. (2003). The primary recruiting resources in the US are recruiters and advertising, for which the US Department of Defense spends over $1 billion annually. Through information and persuasion, recruiters and advertising can influence youth preferences and thereby expand the number of individuals willing to join the military at the wage .

Opportunity costs consist of the civilian wage opportunity (W^c ) plus a non‐pecuniary preference τ that measures the value the individual places on non‐pecuniaries offered by the civilian sector minus those offered by the military. Individuals prefer to join the military when W^M  > W^C  + τ.

The values obtained for the areas X and R are conditional on the linearity of the model, which derives from the uniform distribution the opportunity costs follow over the population of service‐eligible individuals (Warner–Asch 1996).

In Figure 2, the first period opportunity cost of a draft force is A + B + C + D + E, so in a random lottery draft the opportunity cost of the draft force exceeds the cost of a volunteer force by area D + E. As a result, the opportunity cost of a draft force exceeds the opportunity cost of a volunteer force.

When trade in lottery tickets is permitted and substitutes are available, conscripts with opportunity costs exceeding will be willing to hire a substitute with opportunity costs below this value; the same individuals who would have entered under the volunteer force enter under a draft. See Moore (1924) for a fascinating discussion of the market for substitutes during the Civil War. The hiring of substitutes has not been allowed in the United States since then. We know of no countries in Europe that have permitted the hiring of substitutes either.

In the European countries that currently have a conscripted force, terms of service for draftees range from 6 months to 15 months. In the US prior to 1973, draftees served for two years. But the higher pay required to implement a volunteer force induces volunteers to join for longer initial terms and re‐enlist at much higher rate. The average term of enlistment in the US is now about 45 years. One advantage of longer initial enlistments and higher retention is reduced turnover and lower training costs. The annual turnover rate in the US enlisted force during the draft was about 21%; today it is around 15% (Warner and Asch, 2001)

Notice that if the government is following an optimal policy, the draft wage in equation (9) will exceed the draft wage in equation (8).

At this summit the British seriously took into consideration the French proposals of a better defined and stronger European army.

‘In strengthening the solidarity between the member states of the European Union, in order that Europe can make its voice heard in world affairs, while acting in conformity with our respective obligations in NATO, we are contributing to the vitality of a modernized Atlantic Alliance which is the foundation of the collective defense of its members’ (Joint Declaration Issued at the British‐French Summit, Saint‐Malo, France, 3–4 December 1998).

The opposition party denounced the plan as ‘rash’ and ‘politically motivated’. See http://www.euromil.org/newsitem.asp?newsid = 4.

This number included 16,018 officers, 24,418 enlisted personnel, 22,914 militaries employed by contract and 26,150 civilians.

Converted from Romanian leu to US dollars at current exchange rates.

The US military devotes significant resources to recruiters and advertising (Warner, et al., 2003) Given the small size of most European countries in comparison to the US as well as the concentration of their populations in a few large cities, resources devoted to recruiters and advertising are likely to be relatively lower.