THE IMPACT OF HOUSING WEALTH ON HOUSEHOLD CONSUMPTION IN CHINESE URBAN HOUSEHOLDS

10.2478/bjlp-2022-001074

Abstract

Housing is not only household consumer goods, but also an important asset of the
family. In recent years, China's household housing wealth has been increasing with the
growth of real estate prices. It has been extensively studied how housing wealth affects
households' consumption behavior, but less is known about the varied impacts of different
wealth sources on the consumption patterns of various economic classes. This study
examined the degree to which housing wealth influences the consumption patterns of
persons of different economic status while accounting for geographical variations. Using data
from the 2011–2019, China Household Finance Survey, we used the linear mixed model
estimation, Analysis of Variance (ANOVA) and regression analysis. The findings indicated
that there is a significant urban-rural regional gap across China's eastern, middle, and
western areas. Although it has a little impact on rural households' consumption, housing
wealth has a big positive impact on urban households' consumption. Financial wealth and
pension may help to offset some of the spending imbalances brought on by annual family
income. Poor households are able to utilize more medical and health-care facilities because
to higher pensions. To commence with, for the older population that is particularly in need
of care, authorities must strengthen the social scheme.