Document Type
Article
Date of Original Version
2020
Department
Human Development and Family Studies
Abstract
Growing research shows that information technology accelerates economic growth and development, but the effect of Internet penetration on inequality is less well documented, especially about consumption inequality. On the one hand, Internet lowers transaction costs and offers equal access to online products especially beneficial for remote and poor populations, seemingly reducing inequality. On the other hand, uneven access to the Internet may increase divergences. This study examines the relationship between Internet penetration and consumption inequality. Using data from 155 counties available from 2010 to 2016 China Family Panel Studies, this study examines whether Internet penetration potentially impacts consumption inequality considering regional heterogeneity. Based on fixed‐effect models and the two‐stage least squares regressions, results suggest the Internet penetration may increase consumption inequality measured by the Gini index. Furthermore, higher education and over a certain Internet penetration rate buffer the positive impact of the Internet. In some cases, the Internet has smaller positive or even negative impacts on consumption inequality in regions with higher education levels and over threshold penetrations.
Citation/Publisher Attribution
Zhang, S, Li, F, Xiao, JJ. Internet penetration and consumption inequality in China. Int J Consum Stud. 2020; 00: 1– 16. doi: 10.1111/ijcs.12575
Available at: https://doi.org/10.1111/ijcs.12575
Author Manuscript
This is a pre-publication author manuscript of the final, published article.
Terms of Use
This article is made available under the terms and conditions applicable
towards Open Access Policy Articles, as set forth in our Terms of Use.