Dissertation > Economic > Economic planning and management > Economic calculation, economic and mathematical methods > Economic and mathematical methods

A Study on the Effect of Changes in Consumption Structure on the Industrial Structure

Author DuWeiJie
Tutor JinTong
School Zhejiang University of Finance
Course Industrial Economics
Keywords consumption structure almost ideal demand system model industrial structure input-output analysis
CLC F121.3;F224
Type Master's thesis
Year 2012
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With the economy developed to a certain stage, its growth of content becomes more important than the growth of extension. Economic growth of content is mainly reflected in the adjustment of industrial structure and the optimization and upgrading of economic structure. However, in the process of social production, consumption is the ultimate goal of production and the starting point of new production. In a market economy, as the premium for recognition of production activities, consumer demand fundamentally determines the nature and quantity of production. Being an important aspect of consumption demand, consumption structure is an important factor in influencing and restraining industrial structure and economic structure. Adjustment and optimization of industrial structure should conform to the demand of the change of consumption structure.Since reform and opening up, Zhejiang Province has made remarkable economic achievements. With the total economic volume growing continually, the quality of life for urban and rural residents has improved greatly, which leads to the optimization and upgrading of consumption structure. With the optimization and upgrading of consumption structure, industrial structure of Zhejiang has also been through great changes. Economic resources flow from the less efficient industry into the relatively high efficient industry, optimization and upgrading of industrial structure becomes the theme of economic development in Zhejiang province. Being influenced by the world financial crisis, the export has been severely constrained, which made transformation of economic growth mode a more urgent task. Economic growth mode must change from mainly relying on investment and export to relying on the integration of consumption and investment, domestic demand and foreign demand. Therefore, the analysis of the history of consumption structure changes in Zhejiang Province, its causes and the influence of the changes on industrial structure would be practical to the promotion of industrial upgrading and optimization of economic structure.First, the paper reviews the relevant theoretical literature about the consumption structure and industrial structure, giving an analysis of the meaning, the classification and the influential factors of the consumption structure, and then on the basis of previous studies, the author summarizes the working mechanism and its manifestations of changes of consumption structure on the industrial structure.Secondly, taking Zhejiang urban residents as an example, the author analyzed the changing process of the consumption structure, and divided it into several important phases, mainly based on the Engel coefficient and GDP per capita. According to the analysis, consumption structure of urban residents in Zhejiang has been through clothes and food to shelter and consumption, and health insurance to transportation, and communications to culture and education, and entertainment, and each consumption expenditure has showed its own changing laws.Again, based on the above findings, using the almost ideal demand system model and the data from "Zhejiang Statistical Yearbook," 1996-2009, the author made an empirical analysis of the causes of consumption structure changes that led the society to a consumption-oriented society according to GDP per capita by international standards getting the conclusion that income growth and consumer price changes were the main factors that affected the upgrading of consumption structure.Then, using the input-output analysis, we measure the size of the impact-force about the changes of consumer structural on the industrial structural. We get that the changes of consumer structural is the main driving force to upgrade Zhejiang Province’s industrial development, changes in consumption structure of 17 departments explain to the industrial structural changes in 44.16%. And imports for final consumption from some of the impact of industrial development have also been measured, that the imported parts are to some extent to promote the industry, but it has some negative effects to industry upgrade.inally, based on empirical findings combined with the practical of Zhejiang Province, this paper analyzes the policy implications. Policy implications of this paper are mainly reflected in two aspects: First, the optimal policy to promote the consumption structure, and how to use the consumer to upgrade the industrial structure adjustment policy.The possible innovation of this paper is the innovation of research methods. in the past empirical research on the Zhejiang Province’s consumption structure, the general expansion is the linear expenditure system model (ELES), although the model takes into account income levels and price level of goods consumption, the price level of classification of goods for each consumer to determine their impact or affect the significance level on each category is hard to analysis by the model. In this paper, almost ideal demand system model (AIDS) can make up for deficiencies better, which has some innovative ways. In addition, the paper related to the use of input-output theory, which can be used to measure the impact of changes in consumption structure on the industrial structure, by using of Zhejiang Province in 2002 and 2007 Table 17 sector input-output, the measurement methods have some originality.

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