Research On The Relationship Between China’s Consumer And Urbanization And Social Security

Since the reform and opening up, China’s economic level showed a rapid growth state, the residents’ income level has also been increased largely. However, the residents’ consumer spending to GDP ratio has shown a long-term downward trend, at the same time, comparing with other countries, the consumer demand for our residents also showed a significant low level. The dweller rate of consumption is the proportion of consumer demand of GDP, which not only reflect the consume effect of stimulating economic growth in the three major demands,but also an important indicator measuring a country’s economic development level. Irrational consumption rate has directly related to the residents ‘spending power and the level of residents’ consumption, affecting the normal, healthy operation of the national economy. Therefore, our residents’ irrational consumption phenomenon is not conducive to China’s economic structure optimization and rational allocation of resources. For the problem of consumer demand shortage, the Chinese government has developed a variety of policies to expand domestic demand. Many scholars has also been actively exploring how to form a long-term mechanism to promote consumption, analyzing the reasons for the lack of consumer deeply on various aspects. Not long ago, the central leaders put forward the standpoint t that urbanization is the greatest potential to expand domestic demand on the Central Economic Work Conference, confirmed the direction of increasing consumer demand to expand domestic demand as the focus. In recent years, our government economic work report repeatedly stressed that "promote urbanization process actively and steadily and then further enhance the quality and level of China’s urban development." This indicates that the governments will use urbanization as an important measure to effectively solving the lack of consumer demand. Therefore, it is of significant practical importance to explore whether the development of urbanization can effectively promote consume. So far, a large number of scholars have studied and explored the relationship of the two at home and abroad, and the conclusions are quite different. During the study, some researchers have proposed that social security has a significant impact on the development of urbanization and consume.another analysis showed that the social security system disorder is the radical reason why China’s urbanization cannot effectively stimulate consumption. To this end, during the exploration of the impact of urbanization on the residents’ consume in my paper, an important factor for the relationship between the two- the level of social security is added to quantitatively empirical analysis the relationship of consumer spending, the level of urbanization and the level of social security. In this paper, I applied a relatively new method which contains vector auto regression model –VAR model, impulse response function and variance decomposition, taking into account the linkage relationship between the three, fully drawn the long-term relationships and the short-term dynamic effects of the three.At last, substantive recommendations are suggested according to the empirical analysis results. It is of great significance to promote the healthy and harmonious development of social economy of our country.