Grey relational analysis on the relation between China's gdp and defense expenditure

The relation between Chinese GDP and defense expenditure is investigated based on the data from 1978 to 2015, which is divided into four stages according to national defense development strategy evolution and defense spending growth rate. The results revealed that the absolute degree of grey incidence between defense expenditure and GDP is relatively small, illustrating defense expenditure exerts less pressure on the economy; on the other hand, the relative degree of grey incidence between defense expenditure and GDP is relative large, indicating that the economic growth is playing an important role in the development of national defense.