Research On Urban Households’ Consumption Pattern In China From The Perspective Of Life Cycle

In order to promote high-quality economic development,President Xi Jinping proposed in July 2020 to foster a new dual-cycle development architecture at home,with the domestic cycle as the mainstay and with domestic and international development reinforcing each other,the core meaning of which is to insist on expanding domestic demand and forming a strong market.As urbanization continues to advance,China’s urban residents’ consumption is growing strongly,and the contribution rate of urban residents to national consumption in 2020 is as high as78.5%,urban residents’ consumption has become a solid driving force for China’s economic development.At the same time,China’s population structure is also quietly changing.Statistics show that in 2021,China’s birth rate will drop to 7.52‰,while the proportion of the elderly population over 65 years of age will rise to 14.2%,and the coexistence of "fewer children" and "aging" has become a distinctive demographic characteristic of China.This paper intends to analyze the consumption pattern of urban households in China from the perspective of life cycle and provide reference for the accurate formulation and implementation of policies to expand domestic demand and promote consumption.Three possible contributions of this paper are as follows:Firstly based on the perspective of life-cycle,we discuss and conclude the household consumption patterns in urban areas,which enriches relevant research in this field;Secondly combined with China’s national conditions of population structure transformation,we analyze consumption demand with its potential causes of the urban households in different life-cycle stages;Besides,focused on a comparative analysis of the life-cycle consumption patterns of urban indigenous households and migrant worker households and obtained some heuristic conclusions.Using data from the China Family Panel Studies(CFPS)for 2014,2016 and2018,this paper systematically examines the consumption patterns of urban households in China under a life-cycle perspective and focuses on a comparative analysis of the differences in consumption patterns between urban indigenous households and migrant worker households.Taking the household financial manager as the head of the household,our study finds that compared with young households aged 25,the total expenditure of urban indigenous households and rural migrant households fluctuates in an M-shaped pattern as the head of the household ages,with two "hump" shaped consumption peaks in the middle age(around 40 years old)and old age(around 70 years old)of the head of the household.A breakdown of consumption types reveals that in terms of subsistence consumption,food expenditure of urban indigenous households is generally on par with that of the benchmark group of households with a head of household aged 25,while food expenditure of migrant workers’ households shows a fluctuating downward trend in mid-life(after the age of45),indicating a relatively lower overall welfare level of migrant workers’ households compared to urban indigenous households.In terms of developmental consumption,the education expenditure of both groups fluctuates in a similar pattern to the total expenditure.In terms of medical expenditure,both groups of households start to increase slightly when the head of the household enters old age(around 60 years old).Among them,the increase of medical expenditure of rural migrant households in the elderly period is relatively greater.This reflects the relative disadvantage of rural migrant households in terms of health care protection as compared with urban indigenous households;while in terms of recreation,health care,travel and other enjoyment-oriented consumption,both groups of households show similar performance,with consumption peaks in the middle and old age of the head of household.This indicates that migrant households living in urban areas for a long time are converging with urban indigenous households in terms of consumption concepts and consumption power.For this reason,the policy level should actively adapt to the demographic changes in China,optimize the supply of developmental and enjoyment-oriented services for all age groups,and improve the provision of age-appropriate services to expand "silver-hair consumption",in order to further expand urban household consumption in China,with a view to improving the income level of residents and improving the social security system.