Study On The Relationship Between The Government Expenditure And Residents Consumption Of Chongqing

Since the reform and opening up to outside world, the declining of our final consumption restricted the economy development rapidly and sustainable. Chongqing,as the 4th municipality directly under the jurisdiction of the Central Government, it's residents'living standards much higher than before this years, but the lower and lower final consumption is also disturbed the city. The residents'consumption, as a main part of the final consumption, the consumption per capita per year of urban residents rose to 4937.75 Yuan while the consumption per capita per year of rural residents'rose to 5600.68 Yuan. However, from the relative amount of view, whether urban or rural residents per capita consumption rate of consumption trends and are showing a downward trend. The average consumption of urban residents tends to fall by 10% ten years, while the average consumption of rural residents tends to fall by 12%, the consumption rate decreased by 15%. Consumption as an important component of macroeconomic and should play an important economic stimulus. But the current level of final consumption rate is too low, it will affect the entire economy healthy and stable development.In this regard, Chongqing Municipality has implemented a proactive fiscal policy intervention. Between 1997 and 2006, the city's financial expenditure is much higher than the growth rate of GDP. Some experts believe that the growth of government spending increases the level of public goods and services, also increased infrastructure investment and residents'consumption. But there also many other experts have a opposite opinion after their study.Based on the combination of existing research, this paper attempt to study the relationship of residents'consumption and financial expenditure in Chongqing. It will start from the fiscal expenditure structure, select capital expenditure, expenditure on education, R & D expenditure and administrative expenditure of the four projects, and based on the economic theory, use a regression model to analyze, and then draw a conclusion that except the administrative expenditure the other three the other three pairs of the consumer plays a facilitating role. Then provide the foundation for possible solutions of the problem.