New Consumption Is Helping to Upgrade Consumption and Industry

• Published in: China Economic Transition = Dangdai Zhongguo Jingji Zhuanxing Yanjiu Vol. 4; no. 4; pp. 38 - 51
• Main Author: Shaohua, Yi
• Format: Journal Article
• Language: English
• Published: Beijing Higher Education Press 2021; Higher Education Press Limited Company
• Subjects: Business forms; Consumer goods; Consumers; Consumption; Convenience stores; COVID-19; Delayed; Demand; Diversification; Economic growth; Electronic commerce; Expenditures; GDP; Gross Domestic Product; Growth rate; Internet; Manufacturing; Markets; Mobile commerce; National income; Pandemics; Product reviews; Provinces; Residents; Shopping; Shutdowns; Social networks; Theaters & cinemas; Tourism; Willingness to pay; Work; China
• ISSN: 2096-5478
• DOI: 10.3868/s060-012-021-0047-3

The sudden COVID-19 pandemic disrupted Chinese people's normal lives and work and cast a shadow on China's economy at the beginning of 2020. To prevent the virus's spread, many provinces and cities across China implemented traffic control, resulting in prolonged shutdowns of scenic spots, movie theaters, and other crowded places, and delayed the resumption of the manufacturing industry. Consumption, the main engine of economic growth, also faced new challenges owing to the pandemic's impact. Whereas the pandemic had a substantial impact on offline consumption, people staying at home for a long time promoted the rapid development of online consumption in the "homebody economy," spawning many new business forms and models. As the pandemic was effectively controlled, and production and life returned to normal, compensatory consumption rapidly increased the scale of the consumption market. China's GDP rose 3.2% in the second quarter of 2020 compared to a year ago. Thus, the pandemic's impact on the consumption market is short-term and temporary.At present, China's ranks among upper-middle-income countries in terms of per capita national income. Residents' consumption needs have changed from survival to development and enjoyment, and their consumption is characterized less by popularization and more by individualization and diversification. The content of consumer demand includes not only upgrades to traditional consumer products but also many emerging consumer products and services, which together constitute the so-called "new consumption." New consumption is an important manifestation of the upgraded structure of residents' consumption demand. A new model of consumption, represented by the social and sharing models, is rapidly emerging. It features the transition from goods consumption to the development of both goods and service consumption, which can meet consumer demand at a higher level and enhance the quality of consumption.