Residents’ Income Distribution Gap Affects Residents’ Consumption:Theory Interpretation And Empirical Analysis

The Gini coefficient of Chinese residents’ income has already reached 0.4769 in 2014 according to the National Bureau of statistics data. In our country, The residents of different income groups have a hidden welfare income. The actual Gini coefficient of our country has the potential to exceed the level of the alert level as high as 0.5. Dividing standard of Gini coefficient of income distribution of a country by the World Bank. Gini coefficient of 0.5 indicates that the country’s income distribution gap. Therefore, our country may be in the income distribution gap state.Since the reform and opening up, China’s economic growth is mainly dependent on investment and exports, domestic consumption demand for economic growth is relatively insufficient. Analysis on the contribution rate of GDP growth, take 2013 as an example. Final consumption expenditure, total capital formation and net exports of goods and services are three elements. The contribution rate of three elements to GDP growth was 50%,54.4%,-4.4%.The pull of the three elements of GDP growth was 3.9%,4.2%,-0.3%. The final consumption expenditure can be divided into two parts, which are government consumption expenditure and consumer spending. The proportion of the two factors is about 3:7. The contribution rate of China’s resident consumption to China’s GDP growth is about 30% and 35%. There is a clear distance between the 50% of the high income countries.With the continued weakness in the consumer market, the consumption rate of residents is declining. The gap of income distribution among the residents in China also shows a growing trend. The widening income distribution gap, causing the government’s high attention. To narrow the gap between rich and poor, and to maintain social stability has become a top priority. The decline of the consumption rate of the residents and the expansion of the income distribution gap between residents is no accident. The key problem of economic development is the lack of consumer demand.Whether the income gap of residents has caused the decline of the average consumption tendency of our country residents. Worth our in-depth analysis. Especially in the economic operation of our country after entering a new normal. It is important to consider the income gap of residents and the residents’ consumption needs. Whether the income distribution gap of residents has impact on the consumption demand of residents. What’s the transmission mechanism between the residents’ income distribution gap and the consumer demand. These problems are the key to the development of our country’s economic health and sustainable development.Therefore, this paper mainly through the four part to study of the impact of the income distribution gap on the residents’ consumption demand.In the first part, The paper makes a summary of the literature on the impact of the consumption demand on the income distribution gap in China.In the second part, Based on Keynes’s consumption demand function, the model of consumers’consumption theory is established. Through mathematical derivation, a conclusion is drawn. Income distribution gap is too large or too small are not conducive to the growth of consumer demand.The third part Analysis of the gap between the consumption level and the income distribution of residents in China. On the one hand, the problems of China’s residents consumption are studied. On the other hand, From three aspects to descript the income distribution gap of our country.In the fourth part, the theoretical deduction is verified by empirical analysis. Firstly, using empirical analysis by constructing econometric model, Analyzing from two aspects of urban and rural areas. The law of marginal propensity to consume is right in china. Secondly, Studing on the relationship between the income distribution gap of our country and residents’ consumption demand by constructing econometric model, Through regression analysis, the conclusion is drawn. Reducing the residents’ income distribution is conducive to the growth of consumer demandAt last, according to the situation of our country’s resident income distribution, the policy suggestion is put forward. On the one hand, Improving the income of residents in the initial distribution of national income. To improve the regulation effect of the two time distribution; on the other hand, From the three dimensions, to ease the income distribution among residents is not balanced state. Under the new normal economic environment, to stimulating the consumption demand of residents in China, and promoting the sustained growth of China’s economy...