Multivariate analysis of the European economic and defence


In this paper we model the defence and economic structure of 39 European countries using cluster and factor analytic methods. Initial results from standard cluster analysis performed on the original variables are compared with the results obtained from a confirmatory factor model estimated with maximum likelihood method within the general LISREL framework. Namely, a K-means cluster analysis is performed on latent scores calculated from the LISREL model. The results indicate that general clustering patters do not cut across East-West or transitional/non-transition division lines, rather it is found that a more subtitle grouping of countries exists where the more developed transitional countries clearly cluster closer to some West European countries than to the other transitional countries. It is subsequently found that noted differences exist also among the EU countries, which generally do not belong to a single cluster, regardless of the methods used.