Clothing expenditure and the income elasticity of Chinese consumers

In this paper, the clothing expenditure and income elasticity of Chinese co nsumers are investigated by analyzing the clothing expenditure and income i n average households during the past 11 years, their geographic distributio n in 1996, and their variation in urban households with different incomes. From these analyses, we can conclude that the consumptive power of Chinese consumers has increased considerably over the past 11 years, as shown from their steadily increasing income, total expenditure, and clothing expenditu re, However, as their income increases, Chinese consumers tend to spend pro portionally less money on clothing, in both urban and rural households. Inv estigating the geographic distribution of income, clothing expenditure, Gro ss Domestic Product (GDP), and climatic temperature, we find that income an d climatic temperature are important variables determining the clothing exp enditure of urban and average households, while income, GDP, and climatic t emperature have almost equal contributions to clothing expenditure of rural households, On further analysis of income elasticity and marginal impact o f clothing expenditure of urban households, we find that Lower-income house holds have greater income elasticity in clothing expenditure than the highe r-income households. Therefore, lower-income households tend to spend a lar ger proportion of their money on clothing than do higher-income households.