ABSTRACT
It is often posited that because China’s defense budget is low relative to its gross domestic product (GDP), and because its GDP has been growing rapidly, China does not face a significant “guns versus butter” problem. In fact, China’s budgetary allocations over the past twenty-five years suggest that central decision makers are quite sensitive to the relationship between the civilian and military sectors and that, despite the double-digit growth of China’s military budget in the 1990s, civil concerns have consistently weighed more heavily in the minds of the Chinese leadership. Moreover, there is some reason to believe that the very large defense budgets of recent years are likely to decrease as China faces new decisions on how to allocate its resources; a trend that may exacerbate tensions between military and civilian decision makers.
