Research On The Influence Of Government Health Expenditure On Urban Residents’ Consumption Behavior

Since the reform and opening up, Chinese economic development is really rapid,and the total consumption of urban and rural residents is increasing. But because China is in the economic transition period, market-oriented reform results in weakening the government’s public functions,at the same time,medical care,housing and other traditional social security has also undergone a tremendous change.Which make the consumption rate of Chinese residents still at low levels, thereby affecting the sustained and healthy development of China’s economy. Boosting consumers to spend more becomes the government’s urgent need to solve the problem.China’s urban and rural households per capita health spending has increased year by year, and the current problems of “difficulties and high expense in medical care ” are still prominent. Whether it is from the perspective of human health or the market economy, the government has the necessity to intervene in the medical and health market. If we analyze from the perspective of residents of precautionary savings motive,increasing the government intensity of medical health expenditure, on the one hand can for residents to provide better quality public health services, which can improve the health level of all residents and reduce the prevalence rate, on the other hand can establish the basic medical insurance system that cover all the residents, which can effectively solve the worries in the hospital of medical residents, thereby releasing high precautionary savings, boost consumer desire.On the basis of this, this paper takes the consumption expenditure of urban residents as the starting point to carry out research, and builds panel data model with related data of 30 provinces(autonomous regions) urban residents from 1997 to 2013 based on the theory of buffer reserve. Taking into account the year of 2007, the government has established a pilot of basic medical insurance for urban residents with serious illness as a whole. This paper divides the sample into two sub samples, that are1997-2006 and 2007-2013, and make an quantile regression respectively. The results show: under different consumption levels, the effect of the per capita consumption expenditure of the government on the per capita consumption expenditure of urban residents is different, the lower the consumption level of residents, the greater the elastic coefficient. By comparative analysis of the two sub-samples, we can find the elastic coefficient of government health expenditure on consumption of urban residents is notonly a numerical value but also the scope of its impact has also been expanded with the establishment of the basic medical insurance for urban residents. It only affects the lowest consumer groups and lower consumer groups before 2007, and government health expenditure has affected the consumer spending in the middle and higher consumer groups after 2007.These changes in the degree of influence and impact area of elastic coefficient also reflects the implementation of the basic medical insurance for urban residents has really improved the consumption of urban residents.Finally,according to the research results, we put forward the relevant policy recommendations.