Based on extended overlapping-generation model，this paper investigates the impacts of demographic changes on consumption rate．Using Chinese panel data from 2000 to 2013，the estimated results of system GMM and threshold regression reveal that child dependency ratio and elderly dependency ratio have a significant positive impact on consumption rate in urban areas，and the positive effect weakens with the improvement of income growth． While child dependency ratio and elderly dependency ratio have significant negative impact on consumption rate in rural areas，the negative impact of child dependency ratio on consumption rate strengthens with the improvement of income growth，and elderly dependency ratio shows an in- verted U-shape relationship with consumption rate．Thus in China the life-cycle theory of consumption is only applicable to urban areas，and there are significant differential effects of demographic structure changes on urban and rural consumption rate．The long-term decline in the consumption rates is a result of the sharp fall of child dependency ratio in urban areas and the constant increase of elderly dependency ratio in rural areas．