Study On Urban Households Income And Food Consumption In Shandong Province

The masses regard food as their prime want.Food is closely related to the immediate interests of thousands of households. And all the government departments are also very concerned about it. In recent years, with the increasing income levels, price levels are rising, which caused a constant price rise in food, meat and vegetables products ,thus a certain impact on the lives of low-income residents . Because people's income and food consumption has a close relation ,we analize the relationship between them in the article.We take the food consumption of residents in Shandong province for our study in the article, and analize the data of food consumption of residents in Shandong province between 1997-2006 , using linear regression model, the income elasticity of demand analysis, and the method of analysis of Engel's coefficient. The relationship between income of residents and the food consumption were well analyzedin the article. The whole text is divided into five parts. The first part is the introductory remarks, mainly on the issue of the theoretical and practical significance, and some related literature on the issue. The second part is about the methods of the study, data sources, and the software of measurement and analysis, needed in the study of this issue. The third part is mainly about the empirical analysis of the the relationship between income and food consumption of the residents in Shandong, and about the changes and causes of the Engel's coefficient, the changes of the income elasticity of demand, as well as the proportion of wage income and food expenditure. The fourth part is the conclusion and strategies, making a summary of the issue, and presenting better policy recommendations to promote a more effective consumption of the residents. The fifth part of the article is about the references. The main conclusions are: (a) the food consumption of urban residents can be divided into two types ;in different income groups, there are still many differences in the food consumption structure, cash and in-kind expenditures; the first type of the food consumption group is the middle income residents, who eliminate their food cash expenditures mainly for the meat of poultry, eggs and aquatic products, grain and food services, while the second is the high-income residents, whose top three food consumption items were foodservice category, meat, fish, eggs, sugar, tobacco and beverage. In differentincome groups, catering services consumption accounts has risen, and the proportion of residents eating outside increased. The beer beverages, dairy products and consumption of fresh fruits, vegetables and grain category also increased. However, food and other consumer items like spices remained unchanged. (b) In th expenditure structure of in-kind food consumption, for residents of different income groups, numbers of vegetables, fruits, meat and dairy food consumption are on the increase , despite a decline of food consumption with the increasing income; the difference of in-kind food consumption for the high-income and low-income residents is relatively about some large projects such as vegetables, fresh fruit, bottled water, fresh dairy products, fresh melon, meat and alcohol. (c) in different income group, the time sequence and different regions, Engel's coefficient has shown a downward trend, which illustrates that we have a certain increase in the standard of living of urban residents. But because of different price levels, consumer culture and regional differences in consumption practices, there are also some deviations with Engel's coefficient reaction to the consumption level of residents. (d) changes on food income elasticity of demand is relatively small for urban residents; the structure of the food of urban residents is still maintained traditionally, and the food consumption structure is not sensitive responsing to changes in income. (5) trends of urban residents on food consumption demand show that the income level increases, the food needs of the residents will continue to increase and there is still a considerable demand for food consumption; for the low-income residents, an improvement in the consumption of food structure and the quality is still in great demand. (6) wage income also has a certain impact on food consumption; because the fixed income to total revenue has risen too slowly, it will increase revenue uncertainty, and residents often increase savings deposits, thereby lowering the standard of living and food consumption levels. On the basis of the empirical analysis, we put forth a four-point policy proposal in the article: first, change the income distribution pattern to improve the income level of low-income residents; Second, adjust the wage structure, expand the income of residents in the fixed income ratio, and increase the income of psychological stability; third, to enhance food security, and improve the quality of life for residents; fourth, stable consumer prices, and raise the standard of living for residents. The main discovery and innovation are displayed mainly in three aspects: first, the article reveals two aspects from in-kind expenditures and cash expenditures of urban residents in Shandong food consumption structure; the Engel's coefficient changes and the reasons for the change were analyzed, and the Engel's coefficient to measure the consumer level is ensured, and also we pointed out the limitations to use the Engel's Coefficient ; Second, the article analyze the income elasticity of demand of the food consumption for urban residents, which find a phenomenon of the low flexibility in food needs for urban residents, reveals changes in consumption trends in Shandong province, and provide a basis for consumer policy for the government; third, the article proved Friedman's lasting revenue assumptions and found that a lasting and durable consumer income does not exist between the relative stability of the relationship in the process of the consumption for urban residents in Shandong province.