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Li Haifeng

Affiliate Master Yamaguchi University

Household debt, Leverage ratio and consumption expenditure: A macro evidence from China

Yamaguchi journal of economics, business administrations & laws Volume 70 Issue 6 Page 509-530
published_at 2022-03-31
Available 2026-03-31
[fulltext] 1.44 MB
Title
Household debt, Leverage ratio and consumption expenditure: A macro evidence from China
Abstract
This paper empirically examines the impacts of household debt and leverage ratio, measured by the ratio of aggregate household debt to GDP, on consumption using provincial-level macro-data in China. Results show that household indebtedness has a positive and significant effect on consumption expenditure and this remains true for both household debt and leverage ratio, as well as long-term and short-term debts and leverage ratios, and the encouraging effects are heterogeneous across regions. When the debt-to-GDP ratio is below 100%, the consumption experiences faster growth than that when the debt-to-GDP ratio exceeds 100%. In addition, residents’ saving, per capita disposal income and the public expenditure on education, social security, as well as medical and health services are found to have significant positive effects on consumption, while CPI and child dependency ratio have depressive effects.
Creators Wei Zhang
Creators Li Haifeng
Affiliate Master Yamaguchi University
[kakenhi]15501 grid.268397.1
Source Identifiers [PISSN] 0513-1758 [NCID] AN00243258
Creator Keywords
Households Consumption Household Debt Household Leverage Ratio
Languages eng
Resource Type departmental bulletin paper
Publishers The Economic Society of Yamaguchi University
Date Issued 2022-03-31
File Version Version of Record
Access Rights embargoed access