Demonstration analysis of the effect of the population urbanization on the consumption demand

Since the implementation of reform and opening policy, our economy has been seen considerable development. But the problem of insufficient demand is becoming more and more serious, and restrains the development of our economy to some extent. The influencing factors of consumption demand are multifaceted and the dual structure in urban and rural economy is the fundamental reason for insufficient consumption demand. In this paper, the relationship between the consumption demand and the population urbanization was analyzed by the method of econometrics using the statistics data from 1978 to 2008 in China as sample. The demonstration analysis shows that the increasing of the urbanization level has being driven the growth of consumption demand. Therefore, accelerating the process of urbanization and increasing the urbanization rate of population is the fundamental way to increase our consumption demand.