Analysis On Consumption Influencing Factors Of Fuzhou Urban Residents

Consumption, investment and net exports are three driving carriages of economic growth, of which consumption is the most fundamental factor. At present, the purchasing power of the various levels of Chinese consumers is not as strong as it should be. Insufficient domestic demand has become a constraint to further economic development in Fuzhou. As Fuzhou urban residents improve their level of consumption and upgrade their consumption structure, consumption’s contribution to economic growth has not reached the expected level.The writer takes Fuzhou as the research object to describe and probes into the urban residents’consumption status and its influencing factors. The thesis uses knowledge and theories of economics and public administration for studying, qualitative analysis and quantitative analysis for analyzing, theoretical analysis and practice analysis for researching. The thesis will be analyzed qualitatively from the following four aspects: first, the macro-economic elements such as saving rates, tertiary development level and market prices; second, the micro-economic elements such as residents’income, residents’wealth and social security status; third, the urban residents’consumption atmosphere; fourth, urbanization level; and last, public policy supports from the local governments. The thesis takes Principle Components Analysis as the empirical analysis tool to analyze the influencing factors of the urban residents’consumption of Fuzhou. The empirical analysis comes to the conclusion that absolute income hypothesis and permanent income hypothesis can apply to the consumption behavior of Fuzhou urban residents, which is influenced both by current and previous income levels. Among all the factors, per capita disposable income of urban residents, consumer price index and service industry development level has positive effects on urban residents’consumption, among which incomes, CPI and Service industry level have comparatively more remarkable effects.Finally, the writer will set forth some countermeasures for stimulating the consumptions of urban residents from five aspects--improving the public service system, improve the social security system, pushing forward the fiscal and taxation policy reform, building up consumer credit system and accelerating the process of urbanization and industrial structure adjustment.