The Influence of Chinese Government Expenditure on Resident Consumption: Research Based on DSGE Model

This paper constructs a DSGE model to research the influence of China's fiscal expenditure on resident consumption. The study shows there is extrusion effect in China's fiscal expenditure. However the model simulation shows that, through increasing the complementarity between fiscal expenditure and resident consumption, we can turn extrusion effect into packed-into effect, thus make the fiscal expenditure both increase output and stimulate consumption.