Rural Economic Transformation and Household Consumption Structure: An Empirical Study in the Context of Urbanization

In the dynamic process of urbanization, the shift from rural to urban areas has reshaped the economic landscape, leading to substantial changes in income sources for families. This study delves into the critical role of rural economic transformation (RET) in augmenting farmers’ income and subsequently influencing their consumption patterns. Analyzing data spanning from 1984 to 2018, it becomes evident that the urban-rural income disparity has widened, prompting the need for comprehensive strategies to bridge this gap. The study underscores the multifaceted impact of RET on the household consumption structure (HCS), emphasizing four pivotal aspects: urbanization, agricultural mechanization, rural living security, and healthcare provisions. Empirical findings reveal the significant influence of these factors on the enhancement of HCS, with urbanization and agricultural mechanization showing particularly substantial effects. Furthermore, policy recommendations are proposed to steer this transformative process towards more equitable and sustainable outcomes. These include accelerating urbanization while addressing disparities, reforming the household registration system to promote labor transfer, bolstering agricultural mechanization for enhanced productivity, and fortifying the endowment insurance system to ensure social security parity between urban and rural areas. This research not only sheds light on the intricate relationship between RET and HCS but also offers actionable policy insights crucial for fostering balanced urban-rural development and bolstering the overall national economy.