Economic Benefits of Joining NATO - The Case of New Member States and Potential Impact on Sustainable Development in Macedonia

The security of one country is a foundation for stability, economic growth and prosperous society. NATO?s purpose is to guarantee the freedom and security of its members, therefore contributing to the attractiveness of a member country as a host for FDI, which would boost investment and capital stock at the beginning and exports and potential output in the longer run. Our aim in this study is to estimate these economic effects of joining the Alliance by observing the macroeconomic trends of the NMS before and after their accession, which would be a basis for assessing the potential economic impact on new aspirants, such as North Macedonia. In order to do this we employ panel data methods. Statistical analysis for the NMS makes it possible to conclude that NATO membership leads to greater opportunities, including pick up of FDI, intensification of capital stock growth dynamic, marked increase of export activity, productivity growth, decrease in unemployment, improvement regarding rule of law, sustainable development, etc.