The Research On Impact Of Public Consumption Expenditure On Household Consumption In Hunan Province

In the past twenty years, due to the influence of various factors at home and abroad, economics growth has the characteristics of a lack of effective demands in China, and after repeatedly decrease of interest rates failed to achieve the supposed effect, the government turned to the proactive fiscal policy to intervent; household consumption is the driving force of economic growth, and the main purpose of economic growth is to improve the standard of living of the residents. The relationship between government public expenditure and household consumption has always been a hot issue in the theory realm, especially in China whose household consumption has been keeping down drifting. As the degree of the world economic globalization is deeper, the risk of the international financial market is intensified, the international economy terms of trade and international market in our country has tended to be more anxious; consumption demand has been playing an more role on the growth of economy, among the three demands(consumption n investment、net export),consumption is the leading role, but the household consumption has been weakening in the growth of economy annually. The social final consumption constitute of household consumption and public consumption, in the case of the weakness of household consumption, government consumption expenditure should play the key role to enforce the growth of economy; the impact of public consumption expenditure on household consumption has been a long time. through the change of size and conposition of public consumption expenditure, thereby affecting household consumption expenditure, and promoting the development of economy sound and rapidly. It provides a new way of solving the problem-stimulating domestic demand, stimulating consumption, increasing the rate of household consumption.Under this situation, the paper has studied the influence the government expenditure has on the resident consumption in Hunan. Firstlly the paper annalyzes the relation of government pulic expenditure and resident consumption theoretically, proceeding from angle of Keynesian Econoics and New-Classical Macroeconomics analyzing the relationship of government public expenditure and household consumption, including crowding-out effect and crowding-in effect. Meanwhile, the paper has done a simple introduction to the situation of public consumption and household consumption through some arrangements and analysis since the tax system reform in1994. During the empirical ananlysis, use the data of17years in Hunan statistical yearbook, and analyze the impact ofevery part of public consumption expenditure in Hunan province on household consumption, and at the end making a presentation of the outcome with the practical situation, public education expenditure>. public health expenditure、socail security expenditure and administrative expenditure have different roles in household consumption, and the coefficients closing to1,but all being of importance. The effect of government public consumption expenditure on household consumption expenditure showed positive changes, it called crowding-in effect. In terms of coeffients, the pulling power on household consumption expenditure of social security expenditure and administrative expenditure is obvious, every one percent increase of per capital of public educational expenditure making0.1598percent increase of household consumption, and it called crowding-in effect; while the public healtj expenditure has the reverse effect, every one percent increase of per capital of public healtj expenditure making0.0488percent decrease of household expenditure, due to the low level of public health, resulting in the negative effect of government budget, cousing crowding-out effect.Based on the empirical analysis, from the aspects of optimizing the scale of public consumption expenditures and establishing long-term mechanism, the paper proposes some relative policy suggestion, providing the theoretical basis on adjuting the government expenditure structure in Hunan province, therefore promoting the consumption, securing and improving people’s living as well as to stimulate the growth of economy.