The Research on the Consumption Uncertainty of the Civil Residents during the Transitional Period in China
|School||Capital University of Economics|
|Keywords||Economic Transition Consumption Uncertainty Precautionary Savings Liquidity Constraints|
In economics, uncertainty is a fundamental cognitive concept, that means uncertainty is the conditions that arises when an economic agent find himself in a uncertain perception and cognition. As long as there is more than one possible result of a decision, the uncertainty will emerge. Being a fundamental characteristic of transitional economy, uncertainty is mainly composed of three aspects: institutional uncertainty, individual bonded rationality and information incompleteness. Based on the macro-environmental background, this paper fully and systematically discussed the consumption uncertainty of the civil residents in China both in theoretical level and empirical level. This paper also unveiled that consumption theory and empirical research have always been developed along two threads. One is that the evolvement of consumption theory is in consistent with the development trend of the Western Mainstream Macroeconomics, which building micro individual consumption basis for the macro consumption theory;the other is the breakthrough from short-term analysis to long-term analysis by extending the certainty analyzing frame to the uncertainty one based on the intertemporal optimal consumption choice theory.Firstly, this paper talked about the formulation and development of the modern uncertainty theory, mainly analyzing the micro-foundation of the western macro consumption theory and the macro-foundation of the consumption choice, and especially giving elaboration on the effect that the institutional changes uncertainty have on the consumption choice of the civil residents during the transitional period.Secondly, this paper studied the forming mechanism of intertempoal choice and consumption uncertainty, mainly discussing these aspects: the determination of the optimal consumption level under uncertainty , the forming mechanism of precautionary savings theory and uncertainty of consumption behavior、 the forming mechanism of liquidity constraints theory and uncertainty of consumption behavior as well as the mechanism of uncertainty economic policy , and fully analyzing, with the help of mathematical models, the forming mechanism of uncertainty under different conditions.Next, we conducted econometric analysis on the influence factors on the consumption macro-environment of rural and urban resident in China. Regression analysis, Chow test、 co-integration and error correction model(ECM), and timeseries and panel data as well are separately used to verify the influence factor on the consumption in statistical and econometric method, and accordingly established the empirical relation between the long-run equilibrium and short-run fluctuation of consumption and income.Furthermore , we examined , by verifying the micro-mechanism of consumption uncertainty, the extent of precautionary savings motives and liquidity constraints.Considering different stages and urban-rural dualistic economic structure during transitional period , this paper, based on precautionary savings model under intertemporal optimal consumption, made piecewise test on the precautionary saving motives of residents nationwide;besides, we also conducted empirical test and piecewise comparison on the discrepancy of precautionary savings between urban and rural residents. What’s more, we utilized vector error correction model (VECM) under co-integration theory to strictly verify uncertainty and precautionary savings’ error correction mechanism on the consumption change of urban and rural residents. By doing so, we drew the empirical conclusion and offered explanation in macro-level and micro-level.Similarly, based on the test of consumption excess sensitivity, we used liquidity constraints model under intertemporal optimal consumption to conduct uncertainty and liquidity test on urban and rural residents separately. We also made empirical test and comparison on the discrepancy of liquidity constraints between urban and rural residents. By doing so, we drew the empirical conclusion and offered explanation in macro-level and micro-level.Finally, this paper, based on the above theoretical and empirical analysis, drew the main analysis conclusion and made related proposals. The analysis conclusion indicates that during the economic transitional period, consumption of urban and rural residents is of typical uncertainty, which is influenced by the macro consumption environment and also is the result of intertemporal optimal choice of ever-mature and rational consumers. When studying consumer behavior, we should focus on the effect of macro institutional changes, but meanwhile we should not neglect the macro-overall effect of individual consumption choice in the micro-level. Income level is still the main factor on consumption for both urban and rural residents, we, however, should not ignore the effect of other factors, especially theinstability of institutional expectation and uncertainty of future income. We should make great efforts to provide institutional effective supply , exempting the consumers’ future trouble. In addition, we also should do everything we can to increase the sustainable income of residents .Only by doing this can the present consumption of the residents be enhanced, and can consumption requirements be really expanded, and consequently the current situation of inadequate demand will be improved.