Comparison Of Wealth Effect Between The Real Estate And The Stock Market In China

Consumption demand, especially the weak increase of household expenditure demand has become one of the issues that restrict the rapid development of economy in China. So studying the consumption theory and consumption function form has important practical significance in guiding the establishment of consumption policies. In the process of studying consumption function form, one issue that can not be ignored is the relationship between consumption expenditure and the wealth effect.First of all, we make qualitative analysis of the real estate market and the stock market from the aspect of the characteristic of these two kinds of assets , the trait of the wealth effect in the real estate market and the stock market ,the mechanism of the wealth effect in the real estate market and the stock market ,the effect on these two kinds of markets from the finance system.Secondly, this paper make use of the ADF Test ,the JJ Test and the Granger Test to analyze the wealth effect of the real estate market and the stock market in China.Lastly, to promote the wealth effect of the real estate market and the stock market in China ,we provide some suggestion for the real estate market and the stock market.