The Empirical Research Of China’s Urban Residents’ Consumption Behavior Under The Influence Of Housing Area

More than ten years in the recent time, China’s urban residents’ APC has shown aoverall declining trend, it is widely known that a low level of residents’ consumption isadverse to the long-term economy development in China (especially in the aspect ofstimulating the domestic demand). Hence, many domestic and foreign scholars of thisacademic domain have paid much attention to explore the phenomenon in question.They have tried to find out effective explanations to the consumption condition in Chinausing different economic theories and models. Under this background, this thesiscreatively put forward a status-seeking angle to explain the China’s consumptioncondition, trying to interpret the impact caused by status-seeking, the analysis is fullyinvolved with the reality of China. In order to undertake such a work, this paper utilizesthe analyzing framework of utility function in the theory of Habit-formation, in midst ofthe process, this paper adds a variable representative for the positional-goodsconsumption into the utility function, and finally obtains a solution which is a dynamicpanel model; the data of this paper are all microeconomic data, the time span is between2000and2012, the estimating method is the system GMM in two-step. The empiricalanalysis result is consistent with the standpoint in this paper, the very important reasonof why China’s consumption level is low is that China’s urban residents favor therepresentative positional goods——housing very much, and pursue it to have arelatively large area: they devote a enormous proportion to housing and then occupy theother sides of consumption consequently, so their cutting off some parts of currentconsumption seems very rational for consideration. Moreover, through testing thecorrelation between the data of national residents’ housing area and income disparity(standard deviation),and testing the model regression, this paper verifies indirectly thatthe income disparity will strengthening the behavior of comparing the housing area. So,supported by both the theory and empirical analysis, this paper can provide somesuggestions for the improvement of consumption, for instance, our government shouldtry its best to decrease the income disparity and improve urban residents’ hospitalization,pension and housing insurance system, etc; the bank system should lower therequirements of housing loan, etc.