## What’s important to a nation’s GDP and economics growth?

We use two theoretical models to show how specific factors have affected U.S.’s GDP from 1971 to 2010, and China’s GDP from 1990 to 2010.  The theoretical models consist of data about each of these factors: household consumption to average income, interest rate, export.  The GDP is composed by these three factors.  The data set shows each of these factors affects the demand for goods and service and how that relates to GDP.

Aside from the study of GDP performance in macroeconomics there are many other issues that can affect a nation’s growth.  Living standards and productivity are major issues that we will discuss in this study.  We will compare these issues to the percent distribution of the consumption, interest rate and export value to identify which factors have the most significant impact.

## Three Theoretical Models

 HYP 1: GDPG = a + b1C/GDP   +  b2 INVEST + b3POPG + b4EXP +b5IMP +   b6 GOVTSocSec + b7AvehhInc +b8AveCIntr HYP 2: GDPG = a + b1C +  b2 INVEST + b3POPG + b4EXP +b5IMP + b6   GOVTSocSec + b7AvehhInc +b8AveCIntr

We use two theoretical models to determine the extent to which household consumption and other factors have affected GDP growth in U.S. and China during the 20 years period from1990 to 2010.  We will use the data of investment rate, population, export, import, government social security spending, average household income and average consumer interest rate during this period.  These factors would be comparing with the GDP growth and household consumption.

 HYP 3 C/GDP = a + b1GDPG +   b2 INVEST + b3POPG + b4EXP +b5IMP + b6 GOVTSocSec + b7AvehhInc +b8AveCIntr

This particular model is used to see the correlation between household consumption and GDP growth. This model will have the data of GDP growth rate, investment, population, export, import, government social security spending, average household income and average consumer interest rate factors from 1990 to 2010.  These factors will show the relationship on household consumption and GDP ratio of U.S and China.

## Model and Theory

The economics model for my research paper is that consumer spending and personal income level are not relative to each other.  This model will be demonstrated under the utility theory.   My research focuses on the middle class in China and the U.S, describes the changes in middle class in these two countries in the past 40 years.  This research paper looks into GPD and consumer spending, female impact on the consumerism movement and the transformation of the automobile industry in U.S and China.  I am currently researching this subject and working on building this particular economics model and theory.

## China’s Transition to a more Consumer-Driven Economy: What Lessons can be learned from the U.S Experience?

The goal of this research paper is to learn about a consumer driven economy in American and China, for different times of period. Having purchasing power gives freedom and choice to citizens in a market economy. The economy model of this country has gone through significant changes in the pass last century. This research paper will emphasize the change of consumerism from the 1920s to present time. China was under control by Communist Party but has become a more capitalist country in the past 20 years. American is a typical Capitalist country. So this paper will define a consumer driven economy is created and sustain in different political economy environment.
I am planning to compare and contrast the developing consumerism between the U.S and China, in different period of times. I would also like to learn about how to use new statically techniques to analyze data; test hypnosis in order to research my topic underling economics professor’s guidance.