A Study On The Relationship Between Demand Structure Evolution And Economic Growth In China

Sustainable and balanced economic growth is one goal of economic development. The declining economic growth in China has caused extensive attention of the government, as well as scholars since 2010. The reason why Chinese current economic growth stays low is the unreasonable economic structure, and the root of this problem lies in unreasonable structure of demand. This mainly reflects in demand constraint which economic growth needs.At present, China is occupying the period of "three phase superposition" transformation. Maintaining stable economic growth and fostering new points of it are primary tasks.Although common consensus of the relationship between demand or demand structure and economic growth has already existed in theoretical level,there are still many problems need to be solved. Firstly, so many researchers concerning the relation between the demand structure and economic growth focus on macro statically analysis,which lead to less researchers in dynamic ways. Also,there are less studies about the evolution of demand structure and the mechanism of economic growth. Secondly, according to demand structure evolution itself, there is no a widely accepted standard to evaluate whether it is balanced or not. In the practical level, at the same time, researchers about whether demand structure evolution deviate from general rules or not, the actual influence of the evolution to the economic growth in China is insufficient. From what we have mentioned above, this article made the following innovation:(1) Based on the perspective of demand structure, at first, this article extends the AD- AS model against the lack of studies viewing the evolution of demand structure and the mechanism of economic growth. Then, this article divided economic growth into "supply less than demand" and "supply greater than demand" two stages on the basis of status of supply and demand in the development of the economy. In the period of demand lessing than supply, real output equals to potential output, and economic growth is not affected by demand structure constraints; In the other period, economic growth is influenced by demand constraint, so we need to adjust the structure of demand to promote economic growth. After that, under the background of demand structure constraint, this article constructs the extended neoclassicaleconomic growth model in the period of effective demand insufficiently(2) Evaluating demand structure evolution balanced or not under generally no accepted standards. This article firstly defines the index system about the judgment of the imbalance degree of demand structure. It mainly divided into two categories, one is total index and the other is structure index. At the same time, this article does not define whether demand structure is out-of-balance,but simply compare the degree of imbalance. Through comparative analysis and historical comparative, this article analysis the demand structure in national level.(3) In terms of optimizing the path of the demand structure in our country,this article defines the concept of consumption upgrade, It believes that not only the consumption structure need to be upgraded, but also consumption patterns and awareness. It is because that along with the rising of consumers’ demands and the interactive development of consumption and investment,there is a period which consumers’ choice goods and goods change into the utility in demand structure. Besides, based on the perspective of consumption upgrading, this article put forward the path of how to optimize Chinese demand structure. Then, in order to increase rural residents’ consumption, this paper puts forward the theory of interaction of urban and rural consumption.Under the background of the new urbanization, we should optimize the structure of our country’s demand structure.Firstly, the article has summarized and analyzed the law of overall evolution of demand structure and the law of evolution under different dimensions.Under the basement of selecting investment rate(TIR),consumption rate(DCR),net export ratio(NER), consumption and investment ratio(RCI), domestic demand and external demand ratio(EDC) five indicators, this paper analyzes the general law of the evolution of the demand structure in all countries. Then select the level of development of the country,regional differences and national scale as sub-indicators, to explore evolution laws of demand structure under different dimensions economies.Secondly, Based on the law evolution and mechanism of that structural demand evolution to promote economic growth, to explore Chinese economic growth in demand for power selection and the extent of demand for the structural imbalance. Firstly, based on the national scale, economic growthstage and structural demand as the main analysis dimensions. View from the national scale, Chinese economic growth relies on consumer-driven has its inevitability. From the stage of development, our country is in the transition period that investment-led to consumption-led. From the dual structure of view, Chinese rural consumption is more stimulating to a long-term economic growth. With the econometric model, analyze the level of structural demand imbalance both from the national level and the provincial level. And concludes that there is a more serious imbalance of structural demand at the national level. The existence of obvious imbalance between aggregate demand and aggregate supply between 1979-1996. And during 1997 and 2012,Chinese demand structure have imbalanced totally.Thirdly, based on EBA model, the sensitivity of the demand structure of economic growth in China was analyzed. In EBA models, this article selects the actual consumption rate, pulling rate of fixed assets, and net exports rate as three core variables, consumption-investment ratio, external-domestic demand change rate as target variables, variation of the net income of rural residents, urban disposable income rate, the change of Gini coefficient and the change of savings rate and price level as condition variables. After empirical analysis,we can draw a conclusion that the change rate of consumption-investment ratio have no anti-interference "robustness" influence on economic growth but external-domestic demand change rate.The results also shown that external-domestic demand change rate(EDR) is an optimistic "robustness" factor which influence the economic growth. It demonstrated that the increase of external-domestic demand change rate promote economic growth, which is said, external demand is more efficiency than domestic demand in promoting economic growth.Fourthly,based on the above study, it can point out our focus on optimizing the structure of demand in the increasing consumption contribution and enhance the growth speed on external demand. Specifically,Optimize the structure of China’s demand should by consumption upgrade,new urbanization and "along the way" strategy to increase our rate of consumption and improvement in external demand growth.