Dissertation > Economic > The world economic profiles,economic history,economic geography > China's economy > People's living conditions

The Empirical Analysis of Income Mobility of Urban Residents in Tianjin

Author GuoXiaoLi
Tutor BaiZhongLin
School Tianjin University of Finance and Economics
Course Statistics
Keywords Pseudo-panel data Cohort method Transition matrix Income mobility consumption demand
CLC F126
Type Master's thesis
Year 2010
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In late 2008, the global financial crisis had a great impact on the real economy of the world, and China’s exports were severely disrupted. While exports continued to decline, how to ensure steady economic growth, and how to stimulate growth in consumer demand has become the focus of attention. According to lifecycle theory, people’s consumption depends on its current income, expected income and the original property, and the income mobile is an important factor which affects people’s income changes.Based on the data of urban household survey of Tianjin between 1988 and 2008, this paper exploits the cohort method to construct pseudo-panel data, in order to structure AR(1) model and income transition matrix, which respectively analyze the income mobility of different groups (different age and birth-year groups) for long term and short term. There are further explanations in the flowing. Firstly, according to the scientific methods, the data of the income of urban household in Tianjin were collected by professional government agencies, and the samples of urban household were representative. Secondly, AR(1) model of pseudo-panel data, enhances the effectiveness and consistency of estimator of long-term income mobility. Thirdly, based on the basic principle of traditional income transition matrix method, the transition matrix method of pseudo panel data, which method is used for the first time, analyzes income mobility. This method can not only adapt to data of the sample rotation, but also enhance the stability of short-term mobility conclusions.The main results of this study include:(1) on long terms, the overall income gradually grows up, but the overall mobility is low. In age groups, with the age increasing, mobility increases and reaches the maximum at 35-year-old followed by declining. In birth-year groups, the group, whose head of these household were born before the reform, has the lowest income mobility. (2) On short terms, in both age groups and age groups, every income level has the trend to grow up. Obviously, in Middle-aged group, the trend of upward is the strongest, and the mobility of the elderly-aged group is the lowest, some of which have the trend of downward. In addition, The income mobility of groups, who were born before the founding, is low on short terms, and income level of some of these have the downward movement.In view of the characteristics of income mobility, a few of suggestions are proposed to reverse the shortage of consumption demand, optimize the consumption structure, and promote steady economic growth.

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