Research On The Consumption Expenditure Characteristics Of Middle-Income Groups In China

With the changes in the international situation and the relationship between China and the United States,especially the escalation of Sino-US trade frictions,the Chinese economy is facing more pressure from external markets,especially the 2019-n Co V that has swept the globe,which has further exacerbated uncertainty and instability of the external market.From the inherent requirements of accelerating the transformation of China's economic development model,it is urgent to initiate and effectively enhance the fundamental and stable role of consumption in economic growth.Most of the existing studies also believe that cultivating and expanding middle-income groups is an effective way to achieve the transformation of economic development model and expand domestic demand,especially consume demand.However,the current academic field still defines the middle-income groups in a different way.There are many different standards,which makes it difficult to measure the size of China's middle-income groups and its' consumption expenditure level.On the basis of a comprehensive and systematic review and comparison of the definition of middle-income groups,in the context of China's typical urban-rural dual structure,through comparative research and counterfactual calculations,the following three questions have been answered step by step: How many middle-income groups are there in urban and rural areas in China?Second,in the context of the high Gini coefficient of urban and rural residents' income,what are the characteristics of the consumption expenditure of middle-income groups? Third,is the middle-income groups homogeneous? From the perspective of expanding domestic demand,which type of middle-income groups make the biggest contributes to expanding consumer demand?This article attempts to focus on these three issues,fully sort out and compare the concepts and measurement standards of middle-income groups,draw lessons from the development of sociology to divide the middle class,and introduce occupational and educational variables to further subdivide middle-income groups.That is,on the basis of using income indicator to define middle-income groups,middle-income groups that meets occupational indicator is referred to as “semi-Core(occupation)”,the middle income groups that meets the education indicator is referred to as “semi-core(education)”,the middle-income groups that meets both the occupation indicator and the education indicator is called the “core middle income groups”,and the middle-income groups that meet neither the occupation indicator nor the education indicator is called “marginal middle-income group”.Measures the size of the middle-income groups in urban and rural areas by using China Family Panel Studies in 2016 and 2009.From the perspective of average consumption propensity and consumption structure,I observed the characteristics of consumption expenditures of middle-income groups in China.Based on the assumption that the average consumption propensity is increased by 10% and the flow of different income groups,the influence of middle-income groups on the overall consumption rate is analyzed.After research and analysis,the following four main findings were obtained.Firstly,from the perspective of the proportion of middle-income groups,the size of rural middle-income groups is slightly higher than that of urban areas in 2015,mainly because the income density of rural residents in the middle position is greater than that of urban income distribution;but the quality of urban middle-income groups is better,because urban middle-income groups have bigger proportion of higher degree and higher professional status.Compared with 2009,the size of urban and rural middle-income groups have slightly decreased,but the structure is improving,especially in rural areas.Secondly,from the perspective of average consumption propensity,the average consumption propensity of urban residents is higher than that of rural residents,and the effect of education on the promotion of consumption propensity is greater than that of career choices.The average consumption propensity of urban middle-income groups is 8.72% higher than that of rural middle-income groups,mainly because the rural savings motive is stronger.In addition,the average consumption propensity of urban middle-income groups that meet education targets is about 10% higher than those that do not meet education targets,mainly because households with lower levels of education do not have strong confidence in the sustainability or increase of future income and have stronger Smooth consumption and preventive savings motivation.The difference between different types of middle-income groups in rural areas is not large,and the difference between high and low is only within 2%.This reflects that from the perspective of consumption expenditure,the urban middle-income group is divided within the city,and the consumption expenditure of urban middle-income groups is more diverse.Thirdly,from the perspective of consumption structure,most urban and rural middle-income groups are in the stage of improving survival-oriented consumption,and pay more attention to durable goods and cultural and recreational goods.Middle-income groups help to promote consumption upgrades.However,within the middle-income group,due to the composition of different types of middle-income groups,the consumption characteristics are different.From the marginal,semi-core to core middle-income groups,the characteristics ofthe consumption structure are gradually upgraded.Compared with rural areas,urban middle-income groups pay more attention to consumption at the spiritual level,and their cultural and entertainment expenditures account for 4.44%,while rural areas only have0.96%.The last but not least,from the perspective of expanding domestic demand,both the "quantity" and the "quality" of the middle-income groups are very important,the core middle-income groups are the most helpful in expanding domestic demand.Assuming that the average consumption propensity of each income groups increases by 10% respectively,it is found that the consumption rate is closely related to the size of the income groups,because the size of income groups is an important variable in the mechanism that the average consumption propensity affects the consumption rate.Therefore,the "quantity" of the middle-income groups are very important.Based on the income groups mobility probability matrix of each income groups from 2009 to 2015,the expected value of the ratio of the change in the consumption income when the unit family of a certain income group is lost is observed.It is found that the reduction in the size of low-income groups and marginal middle-income groups helps to improve the overall consumption level,especially,the families of this two groups join the core middle-income groups.While the core middle-income groups are lost,the expected value of the reduction in consumption is the highest or second-highest.Therefore,the shrink of the core middle-income groups have the largest or second-largest negative impact on expanding domestic demand.The conclusions reflect that the "quality" of middle-income groups is very important.