Consumer Behavior Evolution Of China's Urban Residents

Research on consumer behavior has been an important component in the field of consumption. With the developing theory and improving empirical research methods, consumer behavior theory is also developing and refining. After three decades of reform and opening up, China's urban residents have been in changing institution; and as a result of the transition economy, China's urban residents' consumption behavior has undergone profound changes. On the basis of theoretical analysis and drawing on previous research results, this paper analysis the characteristics, influencing factors and the evolution path of China's urban residents in the framework of consumer behavior.The logic of this paper is as following. First of all, this paper shows the background of the consumer behavior evolution, analysis the basic characteristics and inherent law of consumer behavior evolution, and puts a detailed analysis on the base of consumer behavior evolution depending on the understanding and judgments of status quo. Then, from the perspective of quality growth and intertemporal choice, this paper uses empirical study tools to find that how the quality growth's velocity and the intertemporal substitution influences consumer behavior and the accurate role. Finally, basing on the rational expectations model, this paper uses dynamic simulation method to analysis different impacts from quality growth, intertemporal choice and real interest rate on the consumer behavior evolution path and to get the final result.After analysis China's urban residents' evolution path, this paper found that the consumer behavior's characteristics: increasing consumption level, significantly intertemporal choice, quality growth and rising durable goods' proportion. This paper also found it is somewhat inadequate that only taking use of marginal propensity, budget's marginal share income elasticity, consumption habits and leading effect to explain the evolution of consumer behavior. Therefore, this article put further emphasis on time preference induced from quality growth and intertemporal substitution elasticity, and found that China's urban residents have a higher and time preference changing according to quality growth. Using these findings and rational expectations model, consumer behavior evolution path has been simulated. Simulation results show that bigger intertemporal substitution elasticity make consumption change larger, the consumption gap between relatively faster quality growth velocities is larger than the gap between relatively slower quality growth velocity, and the impact of real interest rate on consumption took on a convergence characteristic.On the research results and conclusions of urban residents' consumer behavior evolution, this paper may have some trial innovation, these innovations are as follows :(1) Using the intertemporal choice behavior theory and two goods model, this paper estimated the intertemporal substitution elasticity of China's urban residents. Estimated results show that: the intertemporal substitution elasticity of China's urban residents between 1992～2007 is greater than it in the period of 1978～2007.(2) In this paper, a more detailed analysis was put on some representative durable goods' quality growth velocities, and this paper found quality growth velocities can reflect the evolution of consumer behavior in a certain extent. (3) After putting quality factors into the intertemporal choice analysis framework, the Dynamic simulation method' results show that quality growth make the consumers preferring future consumption to current consumption, and the consumers will reduce current consumption and increase future consumption when quality growth velocity rising. Moreover, this paper analyse consumer behavior with quality growth or not.