| Since reform and opening of our country, the economic booming last for30years, but the consumption rate is declining with that and the consumption is depression. Consumption rate is too low which has caused a series of problems has become a major challenge to sustained economic development. The Government also implemented the relevant fiscal policies to stimulate consumption. Increase government spending is one of the means. Theoretically, the impact of government consumption to private consumption is uncertain. The result is probably alternative or complementary, or both. Therefore, the dispute is not in theory, but depends on the regions and periods. According to this, the pepper chooses31provinces data from1997-2009to research this problem.This paper analyzes the basic concepts and theories of the government consumption and private consumption, and the definition is expounded. Base on previous studies, we can identify specific items of government consumption, which is economic construction spending, national defenses, science, education, culture and health care and administrative expenses. In the empirical part, the paper using the panel data and least square method to research the relationship between government consumption and private consumption, the coefficient is greater than zero, which indicates that the government of China is crowding into private consumption, and fiscal policy has a Keynesian effect. The increase of government will promote consumer spending. The second part of the evidence, we use cointegration analysis the relationship between the contents of government consumption and private consumption. The result show that government consumption expenditure and economic development in science, education spending has increased benefit the consumer, but administrative expenses, and defense spending on household consumption is a crowding out. Finally, based on the theoretical and empirical analysis we have the relevant policy recommendations. |
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