The Effect Of Retirement On The Consumption Of Chinese Residents

According to the United Nations' standard for aging,China has already entered an aging society in advance in 2000 before its not achieving a comprehensive well-off society.The aging population has brought a series of serious social and economic problems in China,so Chinese government put forward the policy of delayed retirement.While there is a long term shortage of consumption in China,with the expansion of the proportion of the elderly population,the proportion of the consumption of the elderly population in the total national consumption is also rising.Therefore,the study of the impact of the retirement policy on the consumption of China's residents has become very critical.This paper makes an in-depth study of the problem from the following two points.From the theoretical point of view,this paper brings the parameter that reflects the delay retirement policy into the model,and through resolving the classical over lapping generation(OLG)model,results show that the delay retirement policy will reduce the capital stock,reducing the household savings rate,but its impact on the consumption rate of the horizontal direction is uncertain.On the one hand,delay retirement will increase individual lifetime wage income to increase the consumption rate;on the other hand,because of the social security system of our country and the endowment insurance system is not mature,the individual may increase the level of savings rate to support the elderly and save for their own retirement.According to results of the numerical simulation,delayed retirement has failed to increase the level of individual consumption,indicating that delayed retirement is not enough to offset consumption inhibition by aging.From the empirical point,we studied the changes of household consumption expenditure around the retirement age using the data of China Health and Retirement Longitudinal Study(CHARLS)by the method of fuzzy regression discontinuity.The study found that some consumption projects increased obviously after retirement.Retirees have more family life time,therefore have more time to have dinner at home,resulting in fuel and food spending has dramatically increased compared with no retirement.At the same time,the retired population tends to maintain an active lifestyle and actively participate in recreational activities,most of which tend to spend money on life experiences rather than physical objects.On the other hand,there have been significant declines in some items,such as clothing consumption,dining out,beauty maintenance and family tourism consumption.Finally,we hope that the government will introduce a comprehensive retirement plan and pension system as soon as possible.At the same time,it can also reasonably develop the market for the aged products,stimulate the potential consumption ability of the elderly population,and promote the consumption level of Chinese residents.