The Effect Of Public Cultural Expenditures On Private Cultural Consumptions In China

The development of public cultural service in China has been highly emphasized by governments at all levels since the 18th National Congress of CPC. With the strong support of central and local finances, the public cultural service network has been initially established. The construction of public culture is not only to meet the basic cultural needs of residents, but also an important financial means of cultivating and promoting private cultural consumptions. In order to explore the influence paths and results of public cultural expenditures on private cultural consumptions in China, this paper firstly reviews and summarizes the related researches home and abroad which mainly include studies on consumption effects of government expenditures, economic benefits of public cultural expenditures, and factors affecting cultural consumptions. Secondly, we analyze the development trends and present status of public cultural expenditures and private cultural consumptions in China. In the basis of literature review and stylized facts analysis, we successively explore the crowding-in and crowding-out mechanisms of public cultural expenditures on resident cultural consumptions with the use of western economics and cultural economics theories. Additionally, we investigate the influence degree change of these mechanisms and propose the periodical characteristics of public cultural expenditure’s consumption effect accordingly. Moreover, we use threshold panel regression method to examine the nonlinear relationship between local public cultural expenditures and urban residents’ cultural consumptions in China. Finally, we put forward some policy recommendations according to the theoretical and Econometric analysis.The main conclusions of this paper are as bellows:(1) Public cultural expenditures can exert crowding-in and crowding-out effects on private cultural consumptions simultaneously. The final impact is the sum of the weighted of these two opposite effects. Under the influences of disposable income, cultural consumption willingness and level of cultural needs, public cultural expenditures could have different periodical impacts on private cultural consumptions. (2) Considering the relationship between public cultural expenditure and private cultural consumption in different income stages, crowding-out effects are stronger compared with crowding-in ones when per capita income is less than 24760 yuan. However, the negative effect tends to weaken gradually with the increase of income and finally reverses to positive effect when per capita income breaks 24760 yuan. (3) The cultural consumption effects of different public cultural spending are not the same. As the improvement of income, the impact of public library spending on cultural consumption has turned from significant negative effect to positive one, when the negative effect of art performance spending on cultural consumption has been strengthening during the increase of income.Therefore, to promote the consumption effects of public cultural expenditure and improve the cultural consumption level in our country, the following respects should be taken into consideration. Firstly, financial departments and public cultural institutions should increase transfer payments to individuals and cultural companies through tax deduction, price subsidy, cultural consumption coupons and other innovative ways. Secondly, local government should adjust the structure of public cultural expenditures according to the income level in order to expand the economic benefits with no harm to the social welfare of public culture. Thirdly, relevant departments need to give more support and regulation to cultural industries so as to better meet residents’ cultural needs through the coordination of public culture and operating culture. Fourthly, the establishment of social security system and the reform of income distribution system should be continuously improved, which can speed up the effect transformation of public cultural expenditure on cultural consumption in the way of increasing disposable income.