Abstract Constructing a domestic integrated market with free trade of commodities can improve consumers’ welfare. Under the condition of the opening of regional markets, for regions where a large number of commodities are sold outside, the corresponding industries should have strong competitiveness, and the local consumer market should be more developed. When the production scale of a specific industry in a region is small, the inflow of commodities from outside will support the local residents’ consumption. Furthermore, the outflow of a large number of commodities will generate derived demand for intermediate input of transportation, wholesale and retail activities, since the development of domestic value chain can support the trade of intermediate goods, and enhance the competitiveness of products. Based on the input-output tables and other economic data of 31 provinces in China in 2007 and 2012, this paper constructs an econometric model for empirical analysis. The results confirm the mechanism of the relationship between inter-regional commodity trade and residents’ consumption described above. Therefore, it can be concluded that promoting the integration of the final consumption and intermediate goods markets among regions is of positive significance to the promotion of residents’ consumption.
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