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Does Digital Financial Inclusion Increase the Household Consumption? Evidence from China

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Listed:
  • Wei Jiang

    (Qingdao University)

  • Yanhui Hu

    (Jinan University)

  • Hongjie Cao

    (Qingdao University)

Abstract

Digital financial inclusion has emerged as a crucial means to enhance consumer consumption. This study utilizes provincial data from the China Household Finance Survey (CHFS) in 2017 and 2019, along with the digital financial inclusion index developed by Peking University, to investigate the impact of digital financial inclusion (DFI) on household consumption. Moreover, this research delves into the micro-level mechanisms through which DFI influences consumption. By examining these factors, we aim to shed light on the heterogeneous effects of DFI on households with varying consumption levels. The findings of this study provide compelling evidence that digital financial inclusion significantly benefits household consumption. Notably, the effects of DFI vary across different regions and consumption levels. Heterogeneity analysis reveals that DFI has a more pronounced impact on consumption in eastern and rural areas. Furthermore, at the individual level, digital financial inclusion is particularly conducive to the consumption levels of individuals under 60 years old and married individuals. Its promotion effect is achieved by increasing the proportion of household financial assets, improving residents’ financial literacy, and improving overall life satisfaction. Additionally, our analysis of moderating effects demonstrates that family social relations and family age structure positively influence the process. This paper holds significant implications for understanding and enhancing the promotion effect of digital financial inclusion on household consumption levels.

Suggested Citation

  • Wei Jiang & Yanhui Hu & Hongjie Cao, 2024. "Does Digital Financial Inclusion Increase the Household Consumption? Evidence from China," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 15(4), pages 17333-17364, December.
    • Handle: RePEc:spr:jknowl:v:15:y:2024:i:4:d:10.1007_s13132-024-01821-3
    DOI: 10.1007/s13132-024-01821-3
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    References listed on IDEAS

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    Cited by:

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