The Impact Of Household Leverage Ratio On Happines

When the financial crisis that broke out in the United States in 2008 swept the world,the Chinese government adopted the “four trillion yuan” policy to stimulate the economy in response to the global financial shock.Since then,the leverage ratios of real economic sectors such as household leverage ratio have risen rapidly in the past 15 years.This debt-fueled economic mode has made it possible for China to maintain a low unemployment level and moderate economic growth in the background of the global recession.The economic rise is accompanied by Chinese people’s constant pursuit of happiness.The report of the 20 th National Congress of the Communist Party of China clearly stated that making people’s life happier and better is the overall goal of China’s development,and the realization of Chinese-style modernization requires efforts to continuously consolidate the material foundation of people’s well-being.The consumption expenditure of the Chinese household sector is increasing year by year and various consumption markets are thriving,therefore studying the impact of household leverage on people’s happiness and the role of consumption structure is crucial for China’s economic policymaking,Chinese people’s happiness,and China’s rise.Based on the above background,this article focuses on the study of the close relationship between household leverage ratio,consumption structure,and well-being.Using the Chinese Family Panel Studies of Peking University’s Institute of Social Science Survey,data about surveyed family members were selected and integrated from the family member questionnaire,family economic questionnaire,and individual questionnaire.The panel data of household leverage ratio,consumption structure and well-being were analyzed by fixed-effect regression analysis.Based on the benchmark regression between household leverage ratio,and well-being,it was tested whether the influence of consumption structure on household leverage ratio and well-being has a mediating effect,and what kind of mediation effect was also inspected.The results of this article found that:(1)The household leverage ratio is positively correlated with family members’ well-being and families’ improvement of the consumption structure;(2)The mechanism of the consumption structure shows a partial mediating effect between the household leverage ratio and well-being;(3)Heterogeneity analysis also found that the above-mentioned mediating effect also exists in studies on the consumption leverage ratio,and first-time homeowners’ situations can better reflect the above-mentioned mediation effect.The empirical results of this study are of great significance for formulating monetary policy,welfare policy,and improving Chinese families’ well-being.This article further puts forward policy suggestions: monetary policy can narrow the interest rate gap between housing loan interest rates and consumer loan interest rates,and provide more credit concessions for first-time homeowners;promote the same right to rent and sell,and reduce the pressure on households who need to buy houses.