Research On The Changing Of MPC Of Urban And Rural Citizens Under Different Income Levels In China

After the international financial crisis,the international economic situation is relatively volatile,which makes China's external demand continue to be weakened.To achieve a new round of economic growth,it is imminent for China to expand domestic demand,especially the consumers' consumption demand.The research of the marginal propensity to consume(MPC)of Chinese residents can indirectly study the current situation of their consumption demand and provide a basis for better understanding of the problems existing in the consumption situation,so as to formulate better and more appropriate policies to stimulate the consumption of residents,which is also of great significance for China's healthy economic growth.Based on the residents' MPC,this paper uses the data of CHIP2002 and CHIP2013 provided by China Institute for Income Distribution to calculate the MPC of Chinese residents in 2002 and 2013,and carry out the horizontal and vertical comparative analysis.Meanwhile,the study makes measurement tests and gives explanations to the important variables that affect the consumption expenditure of residents.The study shows that:First,with the overall improvement of income level,the MPC of residents in China is on the rise,especially,the rise of MPC of low-income residents is the largest.Second,in 2002,the MPC and income level of Chinese residents shows an inverted "U" type relation.In 2013,the relation in the whole country is also basically inverted "U",but the MPC of urban residents is decreasing first,then increasing and decreasing lastly with the increase of income level.The MPC of rural residents is decreasing totally,but the MPC of urban residents is lower than that of rural residents when the income is below the middle and low income level.When their income continues to grow to the middle and high level,the MPC of urban residents tends to be higher than that of rural residents.Thirdly,the results of the 2013 study indicates that the per consumption expenditure of Chinese residents is negatively correlated with the per capita age of the family,and it is positively related to the per capita years of education.The cumulative wealth of the residents has little effect on the current consumption expenditure.The more wealthy families are more willing to spend on their health.There is a strong negative correlation between family population size and consumption expenditure.In view of the conclusion,this paper puts forward some relevant policy suggestions to improve the income level of Chinese residents,improve the social security system,enhance the consumption desire of the residents,improve the consumption environment,stimulate the rural consumption potential and improve the income distribution structure.