A Study For Differences In Consumer Groups Of Chinese Urban Residents

Facing the global economic slide caused by the financial crisis of America, people focus the expansionary economic policy advocated by British economist Keynes once again, which suggests to promote economic growth through increasing demand. Since 1920s, insufficient consumer demand of residents has been a big problem, which is the restriction of the economic growth. Huge savings cannot be changed into investment, which further makes macroeconomic growth be lack of motion. Our county adopted positive financial policy and monetary policy many times to stimulate economic, but they all failed to reach the expected effect. At this very moment, it is necessary that we should take proper measures to stimulate economic by boosting domestic consumption.Preventive savings is the frontier theory about consumption and saving in modern west economic theory. The global economists have solved many actual consumption problems. In the paper, Dynan's precautionary saving model, which is improved by being added to aggregate risk and idiosyncratic risk according to china's national conditions, is used to analyze differences in consumer groups of china's urban residents with seven urban residents'income groups from 1986 to 2007. This paper is divided into five chapters. Chapterâ… is an introduction, which includes the background, significance of topic, literature review and innovation. Chapterâ…¡summarizes classic theories of the consumption function and preventive savings. Chapterâ…¢introduces models about risk decomposition, the ones including of classic preventive savings, risk reflection and aggregate, idiosyncratic risk reflection. Chapterâ…£is an empirical research to consumption of Chinese urban residents. Chapterâ…¤is the conclusions and suggestions.The main conclusions are:1. Aggregate risk has the similar effect on different consumption groups of Chinese urban residents.2. Relative caution coefficients of Chinese urban residents of seven different income groups are universally high.3. Idiosyncratic risk, which is greatly different, has more important effect than aggregate risk on consumption of Chinese urban residents.