I am struggling to interpret a interaction term.
A 1% point increase in military expenditure growth, leads to a X% point change in GDP growth.
what is a 1% point increase in military expenditure growth? i.e. is it a 1% point increase in the rate of increase of military growth. For example from 5% to 6%.
is it 5% -> 5.005%
and how does this relate to the actual variable military expenditure not the military expenditure growth?
whereby the deltalog(variable) = growth of (variable)
My thesis supervisor has told me that "a 1 percentage point increase in the growth of military expenditure as a % of GDP, is associated with a beta percentage point increase in the growth of GDP per Capita."
I am just trying to wrap my head around the meaning of this? Would it be an increase in the rate of increase of GDP?
Any help greatly appreciated