| A huge negative impact of financial crisis on China’s traditional mode of economic development. Total exports fell a larger. Stimulate economic growth "Troika" one of the exports by the enormous challenges. Therefore, to turn external demand to domestic demand is the present predicament. According to the traditional financial theory, mobilizing increase of consumer spending, must take into consideration the level of the residents total assets and income. So, we study residents asset value movements on consumer spending, that is the Wealth effect of changes in the value of financial and physical assets. As a basis to stimulate China’s consumer and expand consumer expectations. Household wealth study has important practical significance.Firstly, review the results of the study of the impact on consumption of changes in the value of assets at home and abroad, and Summarize the theoretical mechanisms of the wealth effect. Secondly, in this paper, the1979-2011annual macroeconomic time series datas are the samples. Carroll(2011) redefined the variables for consumption, wealth, disposable income variable, and the use of time-series stability test and instrumental variables Inspection Act. Lastly, this article draws on consumer viscosity model. In considering the case of consumption habits, calculating the immediate effect and eventual effect of financial and physical assets.Our results show that:first, changes in financial assets per a unit, you can make changes in the immediate effect0.01082units,and eventual effect0.0494units. Second, changes in physical assets per a unit, you can make changes in the immediate effect0.00388units,and eventual effect0.0177units. Third, changes in securities class of financial assets per a unit, you can make changes in the immediate effect0.01095 units,and eventual effect0.05units, and non-securitization of financial assets wealth effect is negative. Last, changes in disposable income of residents per a unit, you can make changes in the immediate effect0.8units,and eventual effect4units. |
