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Distribution dynamics of China's household consumption upgrading

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  • Yu, Jian
  • Shi, Xunpeng
  • Cheong, Tsun Se

Abstract

This paper studies the distribution dynamics of China's household consumption upgrading by using household survey data. The findings show that the consumption upgrading index is between 0.75 and 0.95 for most of the households. The convergence value of the rural households is much higher than their urban counterparts, and the rural-urban gap can be reduced in the future. However, urban poverty may exacerbate as our findings show that the urban households with consumption upgrading index around 0.63 would experience consumption downgrade. Turning to regional disparity, the western region in China would converge to the highest level of consumption upgrading index amongst the four regions, while the northeastern region would converge to the lowest level. The study suggests that consumption upgrading and development policy should pay attention to regional disparity, rural development, and urban poor, and the measures should be group specific.

Suggested Citation

  • Yu, Jian & Shi, Xunpeng & Cheong, Tsun Se, 2021. "Distribution dynamics of China's household consumption upgrading," Structural Change and Economic Dynamics, Elsevier, vol. 58(C), pages 193-203.
    • Handle: RePEc:eee:streco:v:58:y:2021:i:c:p:193-203
    DOI: 10.1016/j.strueco.2021.05.012
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    More about this item

    Keywords

    Consumption upgrading index; Convergence clubs; Distribution dynamics; Regional disparity;
    All these keywords.

    JEL classification:

    • C16 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Econometric and Statistical Methods; Specific Distributions
    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • D39 - Microeconomics - - Distribution - - - Other

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