Adjustability Analysis of China's Urban/Rural Residents' Consumption Deviating from Incomes -- From the Perspective of Social Stratification Due to Incomes.

Based on the data on the consumption and incomes of both urban and rural residents in China 1985--2008, the co-integration test and error correction model were introduced into the empirical analysis of the consumption of either the urban or rural residents, which deviated from their incomes for long in respect to the adjustability for the deviation. The results showed that the response rate of urban residents to the long-term deviation is slower than rural residents, though the adjustability of the former is higher than the latter. Further, the adjustability of those social strata whose incomes are different and deviating from their consumption was measured, thus finding that the potential adjustability of both the urban and rural middle-income social strata is higher than other social strata in view of long-term trend. The focal point of the income distribution as a national policy is therefore to step up the effort to develop China' s middle class, with the urban middle-income social stratum and rural middle/high-income social stratum taken in as targets. Moreover, the demonstration effect of urban residents' consumption rural residents should be in reasonable use so as to enable the consumption to play a guiding role in urban-rural integration. [ABSTRACT FROM AUTHOR]