| Military expenditure is one of the must financial expenditures for countriesnowadays. In2013, Chinese government plans to set its defense budget at720.2billion Yuan which increases about10.7%compared to the budget number of2012.Determine demand for defense expenditure is one of the most important issues needto be addressed in defense economics. So the analysis of the main influencing factorsof China’s demand for military expenditures means a lot to the sound development ofnational defense economy.This paper contains theoretical analysis and empirical analysis. This articletheoretically shows the economic, politic and military influencing factors of China’sdemand for military expenditures. Then by using the SPIRI data, this study indicatesthat China’s military expenditures are positively influenced by China’s GDP, its rivals’military expenditures, and China’s lagged military expenditures during the period1992-2010.And the paper also made recommendations accordingly for China’sdefense economic development.This paper is divided into five chapters: the first chapter shows researchbackground, research objectives, research status and the use of methods and routes.Also the article’s innovation and shortcomings are described. Chapter II descript someconcepts and theories of defense economic. It is the theoretical basis for the analysisbelow. Chapter III, the theoretical analysis of the relevant factors based on the currentsituation of China’s demand for military expenditure. Chapter IV by using the SPIRIdata, this study indicates that China’s military expenditures are positively influencedby China’s GDP, its rivals’ military expenditures, and China’s lagged militaryexpenditures during the period1992-2010.Also this paper explored the main factorsof military threat China faced empirically. Chapter V, conclusions and recommendations section summarized the above analysis and made recommendationsaccordingly for China’s defense economic development. |
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