Empirical Study Of Chinese Wealth Effect

After the international financial crisis, in our country, transforming the mode of economic growth becomes a pressing issue. A key to the transformation of economic growth mode is to vigorously stimulate consumption, improve the consumption rate of the national economy. Obviously, launching the research about wealth effect of asset markets is critical for achieving sustainable development of our national economy and is of great practical significance. These are not just for the correct understanding and stimulating the consumer behavior of residents, but also for the change of China's economic growth and development mode.Firstly the mechanism of Pigou effect is used to qualitatively compare the stock market wealth effect and the real estate market wealth effect in this paper. Then according to Modigliani life cycle hypothesis of correlation model, using unit root test, cointegration test and error correction model of the total amount of data which is from the first quarter of 2004 to the fourth quarter of 2009, the paper quantitatively compare the stock market wealth effect and the real estate market wealth effect. The empirical test illustrates that the wealth effect of Chinese stock market is negative and smaller, while the wealth effect of Chinese real estate market is positive and larger. Based on this conclusion, I believe that constructing an investment type of stock market is the main way to change the negative and weak wealth effect of Chinese stock market. And improving the real estate market regime to prevent real estate speculation is an important means to maintain the positive wealth effect of the real estate market.