Research On Regional Disparity Of Social Security And Household Consumption In The Social Transitional Period Of China

The widening income gap has led to the rapid differentiation of household consumption expenditure in the transitional period of china. Income redistribution system should play a role in regulating income gap narrowing. But income redistribution system that does not achieve its proper functions is a reverse adjustment.which continue to widen the income gap and the consumption gap between the region(between urban and rural areas).In this study,the above problem is specific into the regional disparities of social security, household consumption expenditure and the impact of social security on consumption expenditure.On the theoretical relationship between social security and consumption, scholars had focused on that the impact of social security on consumption expenditure is a positive effect or negative effect.It is generally believed that social security eases regional income gap and improve the consumption capacity of residents in poor areas(Pigou;Bailey;Martin Feldstein;Munnell).But the relationship between social security and consumption is not absolute. To increase social security expenditure can promote household consumption expenditure in the transitional period of china. But few people had deeply study the relationship social security and household consumption expenditure in china.In this study, essential attribute of social security is revealed and the cause of regional disparity of social security in china is analyzed. On this basis,we described mechanism of the impact of regional disparity in Social Security on household consumption expenditure.The social security system that should promote social justice has become one of the reasons leading to social inequality because of regional disparity in social security system,which has led to decline in consumption expenditure (living standards) of central and western regions, rural residents and vulnerable groups. In other words, the above phenomenon has led to huge disparity in consumption expenditure among different areas. Accordingly,we put forward four theoretical hypotheses in the paper.This paper estimates the regional disparities of social security and household consumption expenditure with range,extreme ratio, standard deviation, coefficient of variation, Theil Index and other methods, using data from China Statistical Yearbook (1978-2008), China Financial Yearbook (1991-2008), China Labor and Social Security Yearbook (1995-2008),31 provincial Statistical Yearbook (1978-2008). Through the establishment of the PANEL DATA quantitative relationship model, the relationship between social security and household consumption expenditure is verified from three dimensions.The main results are shown as follows.The first dimension:the regional disparities of provincial-level urban social security and household consumption expenditure in the transitional period of china.(1)Financial burden of social security expenditure per capita gap(contains the degree of difference) between urban regions had growns during 1995-2008.The level of social security expenditure per capita gap(contains the degree of difference) between urban regions declines during 1995-2008. Household consumption expenditure per capita gap(contains the degree of difference) between regional towns had growns during 1991-2008. (2)There exists different Influencing effects and influence degree of financial burden of social security expenditure per capita on household consumption expenditure per capita in different regions.Other controlled variables include city-level Gini coefficient, urbanization rate and city-level price index. This result fully verifies the hypothesis I,IE, there exists obvious regional disparities in the impact (influencing effects and influence degree) of financial burden of social security expenditure per capita on household consumption expenditure per capita. (3)There exists different Influencing effects and influence degree of the level of social security expenditure per capita on household consumption expenditure per capita in different regions.Other controlled variables include city-level Gini coefficient urbanization rate and city-level price index. This result fully verifies the hypothesis II,IE, there exists obvious regional disparities in the impact (Influencing effects and influence degree) of the level of social security expenditure per capita on household consumption expenditure per capita.The second dimension:the regional disparities of provincial-level rural social security and household consumption expenditure in the transitional period of china. (1)Rural social security per capita gap(contains the degree of difference) between rural regions had growns during 1991-2008.Rural household consumption expenditure per capita gap(contains the degree of difference) between rural regions had growns during 1991-2008. (2) There exists different influence degree of rural social security expenditure per capita on household consumption expenditure per capita in different rural regions.Other controlled variables include rural Gini coefficient, urbanization rate and rural price index. Hypothesis III is only partially verified.IE, there exists obvious regional disparities in the influence degree of rural social security expenditure per capita on household consumption expenditure per capita. But the influencing effects are positive.The third dimension:the regional disparities of the influence of social security gap on household consumption expenditure gap between urban and rural areas within each province in the transitional period of china. (1)Social security per capita gap(contains the degree of difference) between urban and rural areas within each province declines during 1991-2008.Household consumption expenditure per capita gap(contains the degree of difference) between urban and rural areas within each province declines during 1991-2008. (2) There exists different influence degree of social security per capita gap on household consumption expenditure per capita gap between urban and rural areas within each province in different regions.Other controlled variables include Gini coefficient, urbanization rate and price index. Hypothesis VI are only partially verified.IE, there exists obvious regional disparities in the influence degree of social security expenditure per capita gap on household consumption expenditure per capita gap between urban and rural areas within each province. But the influencing effects are positive.We can draw the following conclusions:The regional disparities of social security expenditure per capita and household consumption expenditure per capita are expanding (except the third dimension) in the transitional period of china.There exists obvious regional disparities in the influence of social security expenditure per capita on household consumption expenditure per capita.On the whole,household consumption expenditure per capita gap between different regions is extended by regional disparities of social security expenditure per capita.