Research On The Relationship Between China’s Residents’ Service Consumption And The Tertiary Industry

Residents’ service consumption is becoming the major part of residents’consumption expenditure, the growing of residents’ service consumption is good forpromoting domestic demand, and is playing an important role in promoting China’seconomic growth. The growth of residents’ service consumption is relying on thedevelopment of the Tertiary Industry. While the development of the Tertiary Industrywill lead to the growth of residents’ service consumption.This paper chooses the relationship between residents’ service consumption and theTertiary Industry as research subjects, and analyzes the interrelation betweenresidents’ service consumption and the Tertiary Industry. Therefore, we use paneldata of China’s30urban residents’ per-capita service consumption in eastern region,central region and western region from1993to2011, in order to analyze thecorrelation between per-capita Value-added of the Tertiary Industry and theper-capita service consumption expenditure from a quantitative point of view, thenanalyze the ratcheting effect and the demonstration effect of urban residents’ serviceconsumption. The regression results of panel data model indicate that residents paymore attention to the quality of service consumption in areas where the average levelof service consumption is higher, thus the expansion of the Tertiary Industryinfluences little on the growth of service consumption. The ratchet effect of residents’service consumption is more stronger in areas where have the higher average level ofservice consumption. The demonstration effect of residents’ service consumption ismore stronger in areas where the average level of service consumption is lower.On the basis of the analysis of panel data model, this paper continues to build theGlobal VAR model of main industries of the Tertiary Industry. We choose fiveindustries of the Tertiary Industry from1990to2012, including Transport, Storageand Post Industry, Wholesale and Retail Trades Industry, Hotels and CateringServices Industry, Financial Intermediation Industry, Real Estate Industry. Weanalyze the influence of industry added value, employment level and serviceconsumption level on the five industries through the Generalized Impulse Response Function. Main conclusions: First, The added value of five industries has positiveinfluence on the employment level, Transport, Storage and Post Industry gets thegreatest impact among. Second, there exists spillover effect of employment betweenfive industries. Financial Intermediation Industry influences most on Wholesale andRetail Trades Industry. Financial Intermediation Industry has some negative effectson the employment of Real Estate Industry under the certain policy background.Third, residents’ service consumption has positive influence on the added value offive industries, Hotels and Catering Services Industry gets the greatest impact among.In conclusion, residents’ service consumption is closely related with thedevelopment of the Tertiary Industry. The growing added value of the TertiaryIndustry can improve the employment level of each industries. Residents’ income willgrow with the improvement of employment level. The growth of residents’ incomehas positive influence on the increasing of residents’ service consumption, andfurthermore will expand the scale and the employment level of the Tertiary Industry.