In theory, states can gain security by acquiring internal arms or external allies. Yet the empirical literature offers mixed findings: some studies find arms and allies to be substitutes, while others find them to be complements. This article contends that these conflicting findings are due to scholars failing to consider how regime type influences the choice between arms and allies. Since democracies are highly credible allies, states that form alliances with democracies can confidently reduce their internal arms. This is not the case when states form alliances with non-democracies. This study evaluates the argument using data on military expenditures and defense pacts from 1950 to 2001. Taking steps to account for the potentially endogenous relationship between arms and allies, it finds that democratic alliances are associated with lower levels of military spending.
