Regression modeling strategies for optimizing the appropriate size of reserve forces in Republic of Korea

Abstract

This study focuses on the size of reserve forces and the factors affecting their size. As a result of analyzing theory and prior research, we identified the relations between standing and reserve forces. To minimize the problem of relations, we used a two-stage least squares estimate with simultaneous equations as the analytical method used. We utilized the 2022 cross-sectional data points and analyzed the sample by dividing it into 69 countries and 38 countries with reserve forces. In 38 countries, the reserve force size derived from regression analysis was 2.2 million people, and the standing force size was 470,000 people. The empirical analysis shows that 2.2 million reserve forces solved the single-equation estimation problem caused by the two-way causal relationship between reserve force size and standing force size through simultaneous equations, which further improved the consistency of the estimated coefficients. In terms of size, it was smaller than the 2.75 million presented in Defense Reform 2.0, which seems to be due to the analysis of countries with relatively capital-intensive military structures compared with Korea. Various factors are expected to further increase the size of future reserve forces: the rapid decline in the nation’s birth population; the proportion of defense spending to the government’s budget; the reserve forces, which have been further expanded by Defense Reform 2.0; and the prospect of a reduction in standing forces expected by Defense Innovation 4.0. Therefore, the size of future appropriate reserve forces will increase further than the current appropriate level, making it necessary to determine policies related to reserve forces and develop appropriate measures for procurement.