In macroeconomics, the guns versus butter model is an example of a simple production possibility frontier. It demonstrates the relationship between a nation's investment in defense and civilian goods. In this example, a nation has to choose between two options when spending its finite resources. It can buy either guns (invest in defense/military) or butter (invest in production of goods), or a combination of both. This can be seen as an analogy for choices between defense and civilian spending in more complex economies.
The "guns or butter" model is generally used as a simplification of national spending as a part of GDP. The nation will have to decide which balance of guns versus butter best fulfill its needs, with its choice being partly influenced by the military spending and military stance of potential opponents. Researchers in political economy have viewed the trade-off between military and consumer spending as a useful predictor of election success.
This model does not typically correlate well with free market economies.
Read more about Guns Versus Butter Model: Origins of The Term, Quoted Usage of Term, Great Society Example
Famous quotes containing the words guns, butter and/or model:
“After a shooting spree, they always want to take the guns away from the people who didn’t do it. I sure as hell wouldn’t want to live in a society where the only people allowed guns are the police and the military.”
—William Burroughs (b. 1914)
“In mathematics he was greater
Than Tycho Brahe, or Erra Pater:
For he, by geometric scale,
Could take the size of pots of ale;
Resolve, by sines and tangents straight,
If bread and butter wanted weight;
And wisely tell what hour o’ th’ day
The clock doth strike, by algebra.”
—Samuel Butler (1612–1680)
“Research shows clearly that parents who have modeled nurturant, reassuring responses to infants’ fears and distress by soothing words and stroking gentleness have toddlers who already can stroke a crying child’s hair. Toddlers whose special adults model kindliness will even pick up a cookie dropped from a peer’s high chair and return it to the crying peer rather than eat it themselves!”
—Alice Sterling Honig (20th century)