The Empirical Studies Of The Influence Of Social Security On Urban And Rural Residents’ Consumption Expenditure

In recent years, the governmentin our country paid more and more attention to social security with the development of economics. The coverage and level of social security also increased year by year. Social security, as an important safeguard for residents’ life, will produce certain effect on consumption of the residents. Investment, consumption and exports are three engines of the national economy. Now the growth of economics is mainly driven by exports and investment in China, however, consumption does not play its important role. In order to change the pattern of economic growth in China, it is necessary to enhance the simulative impact of consumption on the growth of the economy. For a long time, residents’ consumption in China is at a lower level, an important reason is that people’s expectations of future is uncertain. First of all, the incomeof future is uncertain, residents can’t guarantee that they will always have income and income won’t drop in the future;Second, future spending is also uncertain, as education, disease, and incident will cause large temporary spending. Social security will reduce future spending or to increase revenue, thereby, reduce the uncertainty of residents in the future, In this paper, we studied the role of social security in the consumption through the analysis of panel data from 1995 to2012. The study found that social security has morestimulative effect to the urban residents, and less influence on rural residents. In fact, the effect to rural residentsis negative. This is because the level of social security between urban and rural andthe problems they face are different,so is their awareness about social security. At last, solutions and suggestions are put forward based on the problem.