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Ownership and control of defense industrial firms affords the military power, auton- omy, and a claim to economic rents. Why do some countries succeed at shifting some or all such firms from military to civilian ownership and control, while others do not? I argue that differing configurations of relative civilian and military coali- tional and institutional strength contribute to outcomes. Civilian and military must find party and executive-branch allies who can compete for them to craft or defeat legislation affecting their interests, but coalition building alone is insufficient. Actors must also cultivate executive bureaucratic institutions able to design and implement policies promoting their interests. How coalitions and institutions form, ossify, or fail to develop is assessed through a comparative study of Chile, Argentina (1983– 1989), and Argentina (1989–1997).

Although the U.S. government spends billions of dollars annually on foreign assistance, there is no comprehensive tool to assist policymakers in assessing the state of a country's defense sector, to provide them with a systematic way of determining a country's capabilities to achieve various internal security goals, or to monitor the success of defense sector reform programs over time. In response, a RAND team developed the Defense Sector Assessment Rating Tool (DSART), which consists of six assessments to qualitatively and quantitatively determine the state of a country's defense sector, its institutions and processes, and its capacity to carry out operations for counterterrorism and counterinsurgency, counternarcotics, border and maritime security, counterpiracy, and postconflict stabilization. The DSART could be used to assess a country's current capabilities and then, over time, its progress. In addition, it could be used by countries other than the United States to assess their own defense sector capabilities or those of countries to which they are providing assistance. While the DSART is now ready for use, U.S. goals for defense sector reform may evolve, so the DSART is designed with a flexible architecture that can be adapted to a changing security environment

The defense industry in the United Kingdom has experienced significant structural change since the end of the cold war. Consolidation has occurred and overseas suppliers have entered while some domestic prime contractors have exited. The implications of consolidation for innovation have been studied in the U.S. environment but much less so in the case of Britain. In this article we report briefly on the changes to structure and review the theory and empirical evidence that suggests how such change might be related to innovation. Firms' own-financed R&D in the British defense industry is proposed as a useful indicator of innovation activity and is observed to have fallen sharply. Possible explanations are sought in the recently-revived inverted-U hypothesis linking competition to innovation, and in government demand fluctuations and British defense procurement reforms. The authors caution against government taking policy action to influence industry structure until more and better data are available to analyze the potential consequences. Investigating in-contract incentives to encourage industry innovation are recommended as a possible alternative.