Research On The Impacts Of Population Aging On The Rural Residents’ Consumption

Since economic reform in 1978, China’s economy performance is very outstanding, the growth rate is at about 10% being steady and fast. China has become the second biggest country in the economic aggregate, which has been paid attention to by global countries. But there is some trouble hidden behind the excellent performance. Compared with the developed countries experience, China’s economy depends on the investment too much rather than consumption. The problem of low ratio of consumption also has the characteristics of urban and rural differences. Compared with the urban resident, the rural resident with huge amount of population is in a low consumption ratio. During the same period, China’s population age structure also lives through a very rapid change, which entered the aging society in 2000 making a lot of changes in many aspects of society and economic.This paper studies how the population aging influences the rural residents’consumption by introducing population age structure variables children’s dependency ratio and elderly dependency ratio. In terms of research methods, this paper considers both of the theoretical research and empirical research method, expecting to study this issue completely and systematically. In terms of theoretical research, there are three aspects. Firstly we introduce the Western classical theory of consumption, then introduce the influencing mechanism, finally introduce overview of the current research of population aging and consumption. Considering empirical research, this paper uses the panel data of 30 provinces from 1997-2013 by using the dynamic panel data system GMM quantitative methods. In order to draw a better conclusion, this paper introduces two comparative groups. The first one is introducing the total dependency ratio as the measure of the population aging variable. The second one is dividing 30 provinces into three parts named east part, middle part, and west part by geographic area. Through the analysis above, this paper draws the final conclusion which finds the connection between population aging and rural residents’consumption, and finding that different areas have different influences. Finally we put forward some suggestive advices to stimulate rural residents’consumption in both theory and practice.