An Empirical Analysis Of The Impact Of Fiscal Policy On The Consumption Of Residents In China

Study on the effects of fiscal policy on household consumption has been one of the key issues discussed by the economic circles, it is the foucs of the world governments are widely concerned about, in the formulation and implementation of economic policy of a country it is must be taking into account,including the effect of fiscal policy on consumption, because a country’s consumption is of great significance to a country’s economic development. However, the influence of tax policy on consumption what is crowding out or crowding in, the scholars have not been a consistent conclusion for a long time. In recent years, many scholars at home and abroad have established their own theoretical model under the conditions of their own assumptions, collected a lot of data for empirical analysis. But because of different regions and selection of different periods, different data processing methods, that will have a different impact on the outcome; the results of the study will vary. Therefore, it is necessary to further study the impact of China’s fiscal policy on the consumption of residents in China. Through collecting and sorting out the latest data on China’s fiscal expenditure and the main taxes, I use empirical analysis method to analyze the effect of fiscal policy on consumption, and analyze the effects of fiscal policy on the consumption status of urban and rural residents.This paper is including five parts, the first part is the introduction, including the research background and the significance, the domestic and international literature review, research ideas and methods, and the article innovation and the insufficient; the second part discusses the way of the relevant consumption theory and the fiscal and tax policy on consumption; the third part also is the main content, empirical analysis of the effects of fiscal policy on consumption, due to the differences in income and consumption of urban and rural residents is evident, so the consumption of urban and rural residents are analyzed separately, that will have more reference. The article is selected from 1994- 2014 data to study the effect of fiscal expenditure and tax revenue to the resident consumption. Firstly, the paper introduces the China fiscal expenditure, tax revenue and consumption status, direct comparison analysis; and on the basis of selected fiscal expenditure, value added tax, and consumption tax and the consumption of the residents econometric analysis, selects personal disposable income as a control variable to study them for the consumption of the residents for the long-term and short-term effects; the fourth part is conclusion and policy advice, that according to the third part of the empirical results are summarized and suggestions. The fifth part is those references.