An empirical research on the relationship between income and traffic-communications consumption of the urban and the rural residents in China

Consumption, as an important factor to influence income and economic growth, is a research focus of many economists and scholars. Based on Keynes's absolute in-come hypothesis, this paper, with the help of Eviews6.0 software, constructs a consumption model between per capita traffic-communications consumption and per capita disposable income of the urban and the rural residents in China and a model between the income Gini coefficient and average propensity to traffic-communications consumption of the urban and rural residents against the relevant data during 1994–2010. Then the paper contrastively analyzes the relationship between the income and the traffic-communication consumption and the relationship between the internal income distribution and the traffic-communication consumption of the urban and the rural residents from a theoretical perspective. The paper draws a conclusion that there is a long-term equilibrium relationship between per capita traffic-communications consumption and per capita disposable income, as well as the long-term equilibrium relationship between income Gini coefficient and average propensity to traffic-communications consumption of urban and rural residents in China. Further, the paper puts forward some pieces of policy advice, such as continually improving the income level of Chinese residents, achieving the common prosperity through narrowing the gap between the rich and the poor, developing domestic transportation and communications industry greatly.