Urbanization, Aging, and Urban-Rural Consumption Upgrading: A Mechanism Study Based on Inter-Provincial Panel Data in China

Abstract

Based on panel data of urban and rural residents' consumption from 31 provinces, autonomous regions, and municipalities in China from 2011 to 2023, this study systematically explores the evolutionary characteristics, regional differences, and driving mechanisms of urban and rural residents' consumption structure upgrading by constructing a demand income elasticity model, a Gini coefficient decomposition model, and a regional consumption upgrading convergence analysis. The study finds that the consumption structure of urban and rural residents is shifting from subsistence-oriented to development-oriented and enjoyment-oriented, with the urban-rural income gap being the primary factor influencing consumption differentiation. Residential consumption exhibits high income elasticity across all dimensions, particularly in urban areas. Regional consumption upgrading differences show a dynamic pattern of eastern regions leading, central regions catching up, and western regions differentiating, with the growth rate of intra-regional differences exceeding that of inter-regional differences, reflecting the intensifying phenomenon of consumption stratification within regions. This paper proposes policy recommendations from the dimensions of urbanization effects and income distribution structure, aiming to promote the coordinated upgrading of urban and rural consumption and contribute to the realization of the goal of common prosperity.