Analysis On Consumption And Factors Of Urban Households In Shandong Province

Consumption is a key variable in the economic activities. Consumption is related to the welfare level of the participants in the economic activities,also affect GDP, investment, international payments, and other variables in macro economy. On the analysis of the consumption, we can study the consumption itself to find the rule of its development. We can also study the influencing factors based on other variables. According to the need of the research we can select different frequencies of time series, such as annual sequence, quarterly sequence. The sequences of different frequency often contains different consumption rules, which can reveal the law of consumption from different angles and provide more solutions to the problems existing.This paper is based on methods of seasonal integration and seasonal co integration, researching the consumption of urban households of Shandong Province and factors affecting consumption. The sample data ranges from the first quarter of2000to the fourth quarter of2012and are changed to actual series by CPI. First, the paper reviews the study of consumption at home and abroad, finding related research often focused on annual data. Then study the law of consumption of urban households in Shandong Province by the method of seasonal integration. The seasonal characteristics of consumption of urban households in Shandong Province is described firstly, finding that annual consumption peak appears in the third or fourth quarter, consumption trough in the second quarter. Seasonal unit root test shows that consumption has random seasonal pattern, containing not only common unit root, but also the seasonal unit root. Seasonal ARMA model is established to fit the law of consumption. The model shows the current consumer spending growth rate is affected by the lag two phases of consumer spending growth. Finally, the paper uses seasonal co integration and regression methods to study the influence factors affecting consumer spending of urban households in Shandong Province. Seasonal co integration analysis indicates that there is no long-term equilibrium relationship both between consumption and income and between consumption and local government spending. But regression analysis shows that from the perspective of the growth rate, income and local government spending can positively affect consumer spending, it is different from the conclusion of co integration analysis. This may be associated with analysis method and data processing.The innovation of the paper is taking seasonal factor into account and regarding it as an integral part of the variable. The seasonal patterns of consumption, income, local government spending are studied by the method of seasonal unit root test, providing basement for data processing. Also, the paper studied the factors affecting consumption by methods of seasonal co integration and regression. Then the conclusions of two methods are compared. Studying consumption by quarterly data can consider seasonal characteristics of variables and can avoid the disadvantage of shortage of samples.