The Effluence Of Fiscal Expenditure For Assisting Agriculture On The Farmer’s Consumption-an Empirical Analysis

Since the international financial crisis in2008, how to start spending to stimulatedomestic demand has become a major problem for China’s economic development. Inrecent years, according to domestic and international economic situation, theeconomic globalization is deepening, the uncertainty in international trade market isincreasing. So, China’s exports face increasingly serious situation. At the same time,in the context of high domestic inflation pressures and monetary tightening in banks,China’s investment is also difficult. On the other hand, China’s vast territory, largepopulation and unbalanced economic development, deepening market reform,increasing people’s lives obviously show that China has huge consumption potential.Therefore, the main driving force of economic growth is still domestic demand, whichis a solid foundation for China’s economic development.The main inadequate demand is the consumption of rural residents, and its mostfundamental, and the deepest reason is farmers’ low income, inadequate socialsecurity system in rural areas and the poor consumer environments in rural areas.Therefore, in the case of the weak foundation of the rural economy, to study how to bemore conducive to rural economic development, more conducive to rural income,more conducive to increase spending is particularly meaningful.Firstly, this paper will analysis the theories about the relationship of expenditureand consumption; Secondly, from a practical point of view, this paper will describethe development process of China’s fiscal expenditure on agriculture and ruralhousehold consumption; then, using1978-2009annual time series data and1990-2009years of panel data to conduct empirical research, to investigate theintertemporal effects and regional effects of China’s fiscal expenditure on farmer’sconsumption; Finally, based on theoretical and empirical study，this paper will lookfor some suggestions to help China’s agriculture policy.At present, researches of domestic and foreign scholars on the relationshipbetween government spending and consumer have not yet been unified, to study thespecific relationship under special conditions will play a very good guide to China’sfiscal policy; In addition, in-depth study of China financial support for agriculturepolicy, will help to find the problems which may exist in future work; again, in-depthstudy of the changes in China’s rural household consumption and expenditure onagriculture will identify the impacts of past experiences and lessons. This hasimportant practical significance to improve the rural household consumption, expanddomestic demand.