The Impact of the Urban-Rural Gap on Consumption: A Case Study of Middle-income Group in China

Abstract

The current rapid development of the Chinese economy and continuous technological progress have promoted the healthy development of the consumer market, while also stimulating the consumption demand of various groups. Increasing household income and the
accumulation of family wealth have led to the rapid growth of the middle-income group, which has become a key force in boosting consumer demand, supporting consumption growth, and constructing a new development pattern based on dual cycle strategy. Therefore, this
paper, based on the 2019 CHFS survey data, explores the main factors affecting the consumption of the middle-income group by establishing a multiple linear regression model and other methods through Stata. The study found that middle-income group living in urban areas
can effectively promote their consumption expenditure, among them, the effect of promoting housing and food consumption expenditure
is more significant. Thus, this paper puts forward reasonable and effective suggestions based on the results of the model analysis, in order
to raise consumption levels, improve consumption structure and consumption quality, expand the consumer market, and promote economic
prosperity and development.