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Urbanisation and household consumption in China

Author

Listed:
  • Margit Molnar
  • Thomas Chalaux
  • Qiang Ren

Abstract

This paper focusses on the link between urbanisation and consumption behaviour in China. Urbanisation is defined here as rural people moving to cities to work and migrant workers in cities obtaining urban residential status, against the backdrop of government plans to settle 100 million rural dwellers into cities and grant urban residential status to another 100 million migrant workers who already reside in cities. Using household data of the China Family Panel Studies dataset, the paper investigates the impact of those residential status changes on household consumption. The results of the analysis suggest that moving up the residential ladder in this way will likely result in increased consumption by almost 30% for both groups of people and thus contribute to rebalancing of the economy. Higher incomes and longer times in education are important drivers of this process, while a greater number of children in the family discourages consumption. This Working Paper relates to the 2017 OECD Economic Survey of China (www.oecd.org/eco/surveys/economic-survey-china.htm).

Suggested Citation

  • Margit Molnar & Thomas Chalaux & Qiang Ren, 2017. "Urbanisation and household consumption in China," OECD Economics Department Working Papers 1434, OECD Publishing.
    • Handle: RePEc:oec:ecoaaa:1434-en
    DOI: 10.1787/d8eef6ad-en
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    Cited by:

    1. Ullah, Saif & Nobanee, Haitham & Iftikhar, Huma, 2023. "Global financial integration, governance-by-technology, and green growth," International Review of Financial Analysis, Elsevier, vol. 90(C).
    2. Na Wang & Atta Ullah & Xiaofeng Lin & Taiming Zhang & Jie Mao, 2022. "Dynamic Influence of Urbanization on Inclusive Green Growth in Belt and Road Countries: The Moderating Role of Governance," Sustainability, MDPI, vol. 14(18), pages 1-18, September.

    More about this item

    Keywords

    consumption; migrant workers; rebalancing; residential status; urbanisation;
    All these keywords.

    JEL classification:

    • E21 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Consumption; Saving; Wealth
    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers
    • P23 - Political Economy and Comparative Economic Systems - - Socialist and Transition Economies - - - Factor and Product Markets; Industry Studies; Population
    • P25 - Political Economy and Comparative Economic Systems - - Socialist and Transition Economies - - - Urban, Rural, and Regional Economics

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