The Empirical Analysis Of Chinese Urban Residents' Consumption Structure And Demand

Consumption is an important part of the economy, which generally covers 2/3 of GDP in developed country. While the consumption rate is always too low in China, demand shortage has become a factor of destroying economy's fast and sustained growth. How to stimulate consumers'demand, strengthen consumption's influence to accelerate economy growth is a popular question.Concern on the development of consumption structure and demand is helpful for us to adjust the industry structure and recognize the change of economy growth's method. Now the GDP by person of our country has exceeded 1000 dollars, the consumption structure will change from living type to enjoy and development type at this time, according to the theory of consume economy and international experience. The histories of other country have also shown it's an important period. So to study and grasp the change of consumption demand is meaningful especially.Firstly I classify the data of consumption structure using the clustering analysis, in order to find the critical point of change, and preparing for the following empirical analysis. The Ward's method, centroid clustering and etc. have been used as cluster method, Squared Euclidean distance and etc. have been used to measure the interval. The paper classify the data to four period:1981-1984,1985-1992,1993-1998,1999-2004,we make clustering analysis to the variable of consume expenditure, and cluster it to three classes ,we find that : the expenditure of food and clothes in the first class is the basic expenditure of consumers ,the long-term trend is descend, the expenditure of household facility and services, other items is the improving consumption, after satisfying the basic living consumption ,the long term trend is also descend, although there're some fluctuates in several years. the expenditure of medical, transport and communication ,education and entertainment ,housing in the third class belongs to develop and enjoy consumption, the proportion of them in the consumption structure is high and high. and also the change rate of consumption structure is accelerating. Next we classify the data of industry structure and economy cycle, they're coincident in time, which shows that the change of consumption structure will bring the adjustment of industry structure, then bring the change of economy growth's method .In the following chapters, the paper includes two demand system model to study the Chinese citizens'consumption demand.Modern consumption theory shows that a rational consumer will consider all his/her resources in the whole life and distribute them to one's one period accordingly. The consume behavior is not only due to payable income but the permanent income. The payable income consist of two parts: the permanent part Y p and the transient part Y T, while the consumer expenditure is due to the permanent part ,the transient part will not bring the obvious change of consumption. If we bring the permanent income to the ELES model, we will obtain a new analysis frame. In this paper, we take advantage of Bhalla's method to measure permanent income in the paper"The Measurement of Permanent Income and Its Application to Savings Behavior,"then calculate the permanent income of different income grade's consumers, using the data of the year 1999-2004. Then we offer the estimated parameter under the ground of permanent income ELES model, make the analysis of basic living line, magrginal consume trend analysis and elastic analysis. With the economy's development, the permanent income level is increasing, and the expenditure level to satisfy the lowest consumption is improving. The group that couldn't maintain basic demand is enlarging, which calls for a need of the social security's improving of our country.In the following chapter, we use the AIDS model brought by the scholar Deaton and Muellbauer, which is an extend based on Engel curve with the variable of price. I use the expenditure data of 31 provinces in 2004 of the citizen's consumption, with the restrict of additive, symmetry and etc. estimate the parameter in the form of simultaneous equation. Some of the equations have passed the marked test, but most of variables on price are not markedFinally, we advance the policy suggestions accordingly.