Optimal Model of Armed Forces Financing in Iran: An Application of Multi-criteria Decision Making Methods Based on the Experience of Selected Countries

Iran’s Armed Forces has a significant share of the budget resources. Due to Iran's strategic situation in the Middle East region increasing the level of armed forces expenditures is inevitable. Therefore the resources allocated to the military and defense sector must be properly managed and a model must be devised to finance military expenditures in order to minimize the dependence of the military and armed forces on the annual public budget. Using the experiences of other countries and comparative comparisons of these countries, as well as the views of experts this study aims to develop the optimal and appropriate financing models for Iran and validate them using multi-criteria decision making and Delphi techniques. Results show that there are generally three state-based, public-private partnership and outsourcing and privatization approaches to financing the armed forces. According to the results, participation in the development and improvement in the utilization of military facilities and assets, outsourcing of construction projects, changing the application of assets and facilities and creating new capabilities in facilities, establishing an “armed forces financing fund”, developing international partnership contracts in producing military equipment and the opening of a foreign exchange account to finance the import of military weapons are the most favorable methods of financing the armed forces.