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To have or not to have Internet at home: Implications for online shopping

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  • Pérez-Hernández, Javier
  • Sánchez-Mangas, Rocío

Abstract

This paper analyzes the individual decision of online shopping, in terms of socioeconomic characteristics, Internet related variables and location factors. Since online shopping is only observed for Internet users, we use the Heckman’s two-step model to correct sample selection. We argue that one of the relevant variables to explain online shopping, the existence of a home Internet connection, can be endogenous. To account for this potential endogeneity, we jointly estimate the probability of online shopping and the probability of having Internet at home. The dataset used in this paper comes from the Household Survey of ICT Equipment and Usage, conducted by the Spanish Statistical Office on an annual basis. Our analysis covers the period 2004–2009. Our results show that not accounting for the endogeneity of having Internet at home, leads to an overestimate of that variable’s effect on the probability of buying online. We also show that, compared to other variables that are also relevant for online shopping, the effect of Internet at home is quite small. This finding can be important in the design of public policies aimed at enhancing e-commerce through providing households with Internet connection at home.

Suggested Citation

  • Pérez-Hernández, Javier & Sánchez-Mangas, Rocío, 2011. "To have or not to have Internet at home: Implications for online shopping," Information Economics and Policy, Elsevier, vol. 23(3), pages 213-226.
    • Handle: RePEc:eee:iepoli:v:23:y:2011:i:3:p:213-226
    DOI: 10.1016/j.infoecopol.2011.03.003
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    References listed on IDEAS

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    1. Cao, XinYu & Mokhtarian, Patricia L, 2005. "The Intended and Actual Adoption of Online Purchasing: A Brief Review of Recent Literature," Institute of Transportation Studies, Working Paper Series qt095934s0, Institute of Transportation Studies, UC Davis.
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    Cited by:

    1. Irena Atanasova & Vasileios Gerakis, 2023. "B2C E-Commerce Adoption among Elders in Greece," Review of Applied Socio-Economic Research, Pro Global Science Association, vol. 25(1), pages 112-124, June.
    2. Ángel Valarezo & Rafael López & Teodosio Pérez-Amaral, 2019. "Adoption of e-commerce by individuals and digital divide: Evidence from Spain," Documentos de Trabajo del ICAE 2019-19, Universidad Complutense de Madrid, Facultad de Ciencias Económicas y Empresariales, Instituto Complutense de Análisis Económico.
    3. Bang, Se Hoon & Kim, Jaesoo, 2013. "Price discrimination via information provision," Information Economics and Policy, Elsevier, vol. 25(4), pages 215-224.
    4. Pérez-Amaral, Teodosio & Valarezo, Angel & López, Rafael & Garín-Muñoz, Teresa, 2021. "Digital divides across consumers of internet services in Spain using panel data 2007–2019. Narrowing or not?," Telecommunications Policy, Elsevier, vol. 45(2).
    5. Marco Cioppi, 2013. "The role of web communication to enhance the value of retail trade in small cities," The International Journal of Economic Behavior - IJEB, Faculty of Business and Administration, University of Bucharest, vol. 3(1), pages 127-145, December.

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    More about this item

    Keywords

    D12; C35; C25; Online shopping; Internet at home; Binary choice models; Endogeneity; Sample selection;
    All these keywords.

    JEL classification:

    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • C35 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Discrete Regression and Qualitative Choice Models; Discrete Regressors; Proportions
    • C25 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Discrete Regression and Qualitative Choice Models; Discrete Regressors; Proportions; Probabilities

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