The Research On Regional Differences Of Social Security Impact On Household Consumption In Fujian Province

Consumption is an important engine for economic growth.A high level of consumer demand plays a major role in promoting sustainable economic development.However,under-consumption will hinder the process of steady economic growth and bring negative effects to the economy.In the past few years the rank of GDP and GDP per capita of Fujian Province in China enjoyed a higher position,but its final consumption rate and household consumption rate stood at a lower level compared with other provinces.At the same time,there is an obvious regional gap with resident consumption in Fujian and it tends to further expand,which is not conducive to the enhancement of the overall consumption level in Fujian.One reason for the widening of regional disparity of household consumption is the imbalance in the social security capability,which leads to different levels of social security among different areas.In the past,domestic and foreign scholars devoted much time in studying the relationship between social security expenditure and consumption,but no unified conclusion was formed.In recent years,although some scholars started to study the regional differences of social security' s impact on consumption,they almost choose the whole country as their study subject.As it lacks of the study of internal difference in one province,it cannot fully and effectively put forward specific policy recommendations for the provincial government to arrange social security funds.Based on such background,this article firstly outlines the current domestic and international research status of regional differences of social security ' s impact on household consumption.Combing relative theories of social security and consumption,this article analyzes the mechanisms of social security spending on residents'consumption.Then,using the coefficient of variation,Theil Index and other indicators,it empirically analyzes the status of social security spending and different consumption level of urban and rural residents in Fujian.Thereafter,using the panel data of 2002-2013,the article empirically verified the impact of social security expenditure on the consumption of urban and rural residents in Fujian from the perspective of the sub-region.Finally,this article makes a detail comparison of the effects of the social security expenditure on urban and rural consumption in southeast Fujian,western Fujian and northern Fujian.The empirical results show that social security expenditure has significant crowding-out influence on the consumption of urban residents in southeast Fujian,but has no significant impact on consumer spending of urban western and northern Fujian.As for the consumption of rural residents,social security expenditure brings a significant crowding-in effect to the consumption of rural residents in those three areas of Fujian Province.Moreover,the influence varies among those regions,presenting a geographical gap.Therefore,combing the actual situation of Fujian,this paper argues that,in terms of aggregate,Fujian government should keep increasing financial investment in social security in order to stimulate consumption and promote economic growth.For the arrangement of social security funds in different areas,the government should take the actual development condition and the financial capacity of different regions into consideration and reasonably arrange the subprojects of social security expenditure.Then,the government should implement targeted policies and measures efficiently.For example,it should adjust the structure of social security expenditure in Southeast Fujian while increase the overall social security spending in Western and northern areas.As a result,a balanced regional economic development will be achieved through targeted and the overall consumption level of urban and rural residents will be enhanced.