# A study on altruistic consumption of Chinese residents from the perspective of intergenerational income mobility

## TL;DR

This study explores how income mobility between generations influences Chinese residents' consumption habits and altruistic motives.

## Contribution

The novelty lies in analyzing intergenerational income mobility's impact on consumption altruism using an expanded overlapping generation model and CFPS data.

## Key findings

- Intergenerational Income Elasticity significantly increases residents' marginal propensity to consume.
- Higher intergenerational income elasticity strengthens consumption altruism motives.
- Urban residents show stronger altruistic motives compared to rural residents when intergenerational factors are considered.

## Abstract

Resident consumption is an important link to smooth the domestic circulation and promote the economy to achieve high-quality development. To stimulate the vitality of residents’ consumption and achieve the expansion and quality of consumption, we should not only focus on the scale and willingness of residents to consume, but also consider the motivation of consumption. The paper analyzes the impact of intergenerational income mobility on residents’ marginal propensity to consume and consumption altruism motive by expanding the Over Lapping Generation Models and combining the China Family Panel Studies (CFPS) data. The results of the study show: Intergenerational Income Elasticity has a significant positive effect on residents’ marginal propensity to consume. When Intergenerational Income Elasticity increases, the "altruistic motive" of residents’ consumption will also increase significantly. Compared with rural residents, Intergenerational Income Elasticity has a stronger positive effect on urban residents’ marginal propensity to consume and marginal propensity to consume education. With the effect of intergenerational factors, urban residents’ consumption shows stronger altruistic motives.