Shanghai Residents Income - Consumer Relationship Analysis And Comparison

Shanghai's economy began a development with a high speed in 1990's. From 1992, the GDP of shanghai has kept the growth above 10% per year. The income and consume of resident is continually rising. And consumption structure was promoted constantly. But the wheel of Shanghai's economy is not consumption but investment and foreign trade. Generally speaking, if there is an insufficiency of infrastructural facilities and domestic demand, rapid development of investment and foreign trade is favorable to effective demand. And to expand the investment and foreign trade is a chief means of promoting Shanghai's economy in a short time. But in a long time, the real power of development of economy is consumption of resident. The only way to continually and healthily and steadily develop the economy of Shanghai is to expand consumption and harmonious expansion of consumption, investment and foreign trade. So we can avoid the drastic economic variations. At first, this article analyses the consumption situation of Shanghai resident. Then there is an analysis of relation of income and consumption with co-integration theory. And there is a comparison of Shanghai, Tianjin and Zhejiang province. An ECM of income and consumption was built in this article. I hope this article can provide positive argument for consumption policy.This article includes the following contents and conclusions.1. Consumption structure: the consumption structure of urban inhabitant has a more rapid promotion than rural inhabitant. Material needs of urban inhabitant persistently flow to mental needs. The consumption level is continually raised. In food consumption, urban inhabitant is trending towards enjoying type rather than chores type. The consumptions in traffic, communication, education, culture and entertainment make speedier growth. And the consumption in medical care has tremendous potential. The consumption of rural inhabitant is based on food and residence. But the consumption is trending towards traffic, communication, education, culture and entertainment. The living level of rural inhabitant is being continually raised. But the high residence consumption is a ball and chain to the promotion of consumption structure.2. Propensity to consume: Propensity to consume of rural inhabitant rises quickly...