The Influence Of Income Gap On Chinese Household Savings Rate

Since the reform of the economic market in China,with the continued economic growth,the income gap has continued to widen,and the Gini coefficient has been at a high level of “0.4” international security level for a long time.At the same time,China's household savings rate has also reached new highs.According to the data released by the World Bank,China's average saving rate for the 30 years from 1980 to2010 was 37%,which is much higher than that of other countries.The academic community generally believes that increased income inequality is one of the important reasons for the high savings rate.Interestingly,since the 1980 s,the problem of the disparity between the rich and the poor in the American family has become increasingly serious,and the increase in income inequality has kept the American household saving rate from declining or even becoming zero.It is also the comparison and comparison that results from the increase of income inequality.Why the consequence in the United States is that the saving rate keeps declining,and the savings rate shows a significant negative correlation with the income gap.In China has led to the opposite phenomenon of rising savings rates?This article believes that the following points need to be considered in order to make a reasonable explanation for the high Chinese saving rate.First,Chinese families have a non-independent consumer preference.In recent years,numerous studies at home and abroad have shown,conspicuous consumption and positional consumption from wealthy households will have a significant demonstration effect on other families.The low-and middle-income households also hope to catch up and compare the consumption levels of these wealthy families when making consumption decisions.Second,the influence of income inequality on household savings rate is related to China's special economic system.When the income gap widens in families in developed Western countries,Residents are willing and able to spend their money in future spending comparisons,The savings rate will be very low.At present,China'scredit system is not mature and its social security system is not perfect.Mobility constraints are common among households.When the income gap widens,People can neither spend their current income nor dare to smooth their spending in the futureThis further strengthens the residents' saving motivation,making the household savings rate become the main way to satisfy the comparison.Therefore,This article combines China's facts.Using data from the China Family Tracking Survey(CFPS)in 2012 and 2014,Full consideration of many factors such as demonstration effects,comparison motives,and liquidity constraints.By grouping the reference group households and urban and rural households in different income levels.To explore the role of these factors in the income gap affecting the household saving rate.It also provided a reasonable explanation for the high saving rate in China.This empirical study found:(1)There is a significant positive correlation between the income gap and the household savings rate in China.(2)The intensity of liquidity constraints varies between urban and rural households,The income gap has also affected the degree of household savings in urban and rural areas in China.The income gap has a stronger impact on rural household savings rates.(3)The level of social security and the perfection of credit markets have a significant impact on the relationship between income gap and household savings rate.The degree of mutual influence between urban and rural households in China is different,and the impact of income gap on household savings rates in urban and rural areas in China is also different.The income gap has a stronger impact on rural household savings rates.