A Study On The Impact Of China 's Endowment Insurance On Residents' Consumption

China is creating the miracle of economic growth, however at the same time the poor social development and the lack of social security system has become an important reason for the decrease of the residents’ consumption, which holds down the domestic consumption. Pension fund, which comes from pension insurance before one’s retirement, has been the main income for the retirees. Its existence will inevitably affect people’s consumptions. Research on the relationship between pension insurance and consumption has much practical significance. This article focuses on the following four aspects.Firstly, this article introduces some classical theory on consumption, which provides the theory fo undation for the research. Secondly, I make some qualitative analyses to introduce the development of pension insurance and consumption in C hina and the reason for the drop of consumption related to pension insurance. Then, I elaborated the pulling effect of pension insurance on residents’ consumption and found that pension insurance has effects on consumption mainly through the redistribution of income and residents’ psychological expectations. Thirdly, to measure the impact of pension insurance on househo ld consumptions, this article uses data from C hinese General Social Survey(CGSS) in 2010.I analysis the relationship between pension insurance and household consumptions with Tobit and selection model(which could correct self- flection biases). Results find that pension insurance increases household’s consumption on daily expenses(e.g. Food, clothes and house). However, this paper finds that the enrollees’ consumption on personal medical expenses was decreased significantly. At last, I made relevant suggestion for future development of pension insurance.