Study On The Impact Of Urban-rural Income Gap Upon Urban And Rural Residents Consumption In Jiangxi

As one of the four major components of the total demand of the national economy,The consumption demand' increase can usefully promote economy development,it is the main power to promote economic development.Our country needs a long term strategic policy of expanding consumption demand.However,since the reform and opening-up,Due to our country pay too much attention to the role of investment in promoting economic development,the pulling effect of consumption on economic is relative weakness.As the underdeveloped province in the central region of China,obviously,Jiangxi province has the same problems.Now,driven by the central rising slogan,residents' per capita income level of the province is continuously growing,but the inherent dual economic structure system and the malpractice of the income distribution policy restrict the further increase of rural residents' income,leading to the problem of urban-rural income become increasingly serious.The large income gap is mainly because the income of rural residents is less,on the one hand,it has inhibited their consumption,and not conducive to improve the consumption level and improve the consumption structure,leading to the consumption polarization between urban and rural,not conducive to the optimization of the province's consumption structure and improve the consumption level.On the other hand,it hinders the growth of the GDP and indirectly influences the realization of government's "expanding domestic demand,keeping growth" policy objectives.This paper uses the 1980-2014 year time series data to analyze the income gap and consumption gap between urban and rural areas.Firstly,using relevant statistical data,analyzes the income and consumption of urban and rural residents,the urban-rural income gap and consumption gap via the charts,and describe the influence of urban-rural income gap to the residents' consumption by calculation Theil index,the urban-rural consumption ratio and the urban-rural Engel coefficient ratio.Secondly,the paper makes two Pearson correlation analyses to verify whether the income gap is related to the resident consumption in the two regions.The one is based on Theil index and the urban-rural consumption ratio data,the other is based on Theil index and the urban-rural Engel coefficient ratio data.Thirdly,respectively use the Theil index variable,and urban-rural consumption ratio variable,the Theil index variable and the urban-rural Engel coefficient ratio variable to establish the VAR model,analysing the dynamic effects of the urban-rural income gap on the residents'consumption by Granger causality analysis,impulse response analysis and variance decomposition analysis.Finally,this paper puts forward specific countermeasures and suggestions in order to reduce the urban-rural income gap,increase the consumption of rural residents,enlarge the domestic demand,promote the economic development of the province and maintain social harmony.The results show as followings:Firstly,the larger income gap between urban and rural residents will lead to a total consumption gap between urban and rural residents,and it will also affect the residents' consumption structure of the two regions,making the living standards of the two residents different.Secondly,urban-rural income gap has significant positive correlation with the urban-rural consumption ratio,also urban-rural income gap has significant positive correlation with the urban-rural Engel coefficient ratio.Thirdly,the Theil index is the Granger reason of the change of urban-rural consumption ratio,that is changes in the urban-rural income gap will lead to the consumption gap chang,and the Theil index's contribution to urban-rural consumption ratio has increased over time.it also shows that the widening income gap will lead to further deterioration of consumption gap between the two areas.Fourthly,the urban-rural Engel coefficient ratio is the Granger reason of the change of the theil index in a short period,in a long period,the two variables have a cause-effect relationship,it means the widening of the urban-rural income gap will widen the consumption structure' gap,and not conducive to improving the rural residents' consumption structure,at the same time,a large consumption structure gap will reduce rural residents'income and in turn widening the income gap of the two areas.