Digital Finance And Household Economic Behaviour

At this stage,China’s digital finance is developing rapidly.Generally speaking,the definition of digital finance is divided into broad and narrow senses.In the narrow definition,digital finance does not include traditional financial institutions,but in a broad definition,digital finance includes traditional banks,insurance companies and other financial services.Institutions use digital technologies such as big data to carry out businesses such as investment and financing,payment,and settlement,as well as businesses carried out by Internet finance companies(Huang Yiping and Huang Zhuo,2018).This concept is similar to "Internet finance" defined by ten ministries and commissions including the People’s Bank of China).my country’s digital finance and the digital economy are developing rapidly.The digital finance index released by Peking University shows that the average digital finance index at the provincial level increased from 40 in 2011 to 272 in 2017,an increase of more than five times.Digital finance has penetrated into all aspects of the life of Chinese families,including food,clothing,housing,transportation,etc.(Chen,2016).At the same time,from a global perspective,China is also leading in digital finance fields such as mobile payment and digital credit.Then the rapid development of digital finance to our family’s economic behavior has produced an impact.From the perspective of income and wealth accumulation,at present,our country advocates a strategic goal of common prosperity,common prosperity includes two basic connotations,is a rich(efficiency),which embodies in the increase of income and wealth,on the other hand,is fair,embodies the income disparity and wealth gap,the connotation of economic fairness.In addition,from the perspective of consumption,with the ongoing spread of COVID-19 and increasing uncertainties such as trade frictions,it is crucial to stimulate household consumption and expand domestic demand.Therefore,this paper starts from the perspective of digital financial development,explores the impact of digital financial development on household income,consumption,and wealth accumulation,and comprehensively and systematically evaluates the impact of digital financial development on the economic welfare of Chinese families.Traditional financial institutions such as Banks,through distribute the credit resource,etc.,to the social and economic main body of economic activities has a larger influence,as traditional financial institutions,it is often for business profit maximization as the guidance,the socially vulnerable groups such as low income,low wealth be excluded from the financial system,the income of these groups,consumption and wealth accumulation produce negative influence,Finally,it will affect the sustainability and balance of social and economic development.As a new form of financial business,digital finance makes up for the deficiency of traditional finance by virtue of information and cost advantages,which may significantly improve its economic welfare level.Based on the above analysis,this paper firstly sorts out the factors affecting family income,consumption,and wealth accumulation in China,and analyzes the possible mechanism of digital financial development affecting family economic welfare based on existing literature.Then,based on four waves of Household microdata from the China Household Finance Survey(CHFS)in 2013,2015,2017,and 2019,This paper comprehensively and meticulously demonstrates the impact of digital finance development on family economic behavior from three aspects of household income,consumption and wealth accumulation,and also tests the mechanism of digital finance’s impact on family economic behaviour,so as to provide policy suggestions for relevant policy making.The research idea of this article is based on the background of the digital financial and economic development in China,using several waves of households microdata,micro household as the research object,around digital how financial development affects the households’ economic behaviour on the empirical analysis,not only analyzes the digital financial development of China’s household income,consumption and wealth accumulation of the overall impact,It also analyzes the differential impact of the development of digital finance on different groups and households in different regions.Not only analyzes total wealth,and the influence of the overall consumption,and analyzes the digital financial structure of China’s household income,consumption structure,and the influence of the structure of wealth,but the last also explores the digital inclusiveness and fairness of financial development,the number of financial development on the income gap,the influence of the wealth gap and consumption inequality.Different from the existing research on digital finance,this paper systematically discusses the impact of digital finance development on household economic behaviour under the background of common prosperity and provides a new interpretation perspective for the change of households’ economic behavior.The specific arrangement of this paper is as follows:The first chapter is the introduction.This part mainly expounds on the research background and significance,ideas,contents,methods,innovations,and shortcomings of this paper.The second chapter summarizes the existing literature and sorts out the theoretical analysis framework.First of all,the comprehensive analysis of the impact of China’s household income,consumption,and wealth accumulation behavior factor,secondly,household income and consumption,asset allocation aspects included in the household economic welfare analysis framework,detailed combing the use of digital changes in financial development,financial to our country the influence of family income,consumption and wealth accumulation mechanism,It provides a unified theoretical basis for the subsequent empirical test and summarizes and comments the existing literature.Chapter Three analyzes the development status of China’s macro digital finance,the use breadth and depth of micro digital finance,as well as the heterogeneity of household digital equipment and digital finance in different groups and regions,so as to better grasp the development status of digital finance in China from the micro perspective.Based on the micro-data of CHFS,this paper discusses the "digital use divide" and "digital access divide" in the course of digital finance development in our country and analyzes the cause of the "digital divide".Thus,we can better reveal the current situation of the regional digital divide and put forward policy proposals and measures to bridge the digital divide and help rural revitalization and common prosperity.On the macro level,digital insurance is developing the fastest,while digital lending is developing the slowest.There are significant group and regional differences in the use of digital equipment and digital finance.In summarry,the proportion of households using digital finance is higher in areas with higher wealth levels,higher education levels,and developed traditional finance.Lack of financial knowledge,low level of digital literacy,and "digital use divide" is a serious problem,and this phenomenon is particularly prominent in rural areas.The fourth chapter analyzes the impact of the development of digital finance on Chinese family income,including the impact of the development of digital finance on the total disposable household income,itemized wage income,commercial and industrial operating income,and investment income of financial assets.It not only analyzes the overall impact of the development of digital finance on family income but also analyzes the heterogeneous impact of the development of digital finance on the characteristics of different groups and families in different regions.Finally,it further analyzes the impact of digital finance on the income gap of Chinese families.The results show that the development of digital finance has significantly improved the income level of Chinese families.In terms of the heterogeneous impact of digital finance on family income,the development of digital finance has a stronger promoting effect on the income of families with higher physical capital,higher human capital,and urban,eastern,and traditional financial developed regions.The mechanism analysis shows that,on the one hand,the development of digital finance can promote the increase in Chinese residents’ household income by promoting the family’s participation in the financial market and improving the efficiency of financial asset allocation.On the other hand,the development of digital finance can increase household business income by promoting the household business.Finally,the development of digital finance has not significantly reduced the income gap among households.The fifth chapter analyzes the impact of the development of digital finance on Chinese household consumption,including the consumption expenditure of food,tobacco,alcohol,clothing,housing,daily necessities and services,transportation and communication,education,culture and entertainment,medical care and other eight categories according to the standards of the National Bureau of Statistics.This paper not only analyzes the impact of the development of digital finance on consumption but also analyzes the impact of the development of digital finance on household consumption structure and regional consumption inequality.The research found that the development of digital finance has significantly increased the total consumption of Chinese residents,but it has not significantly promoted the upgrading of household consumption structure.Mechanism analysis shows that,firstly,the development of digital finance increases household consumption by improving consumption convenience,alleviating household liquidity constraints,and reducing precautionary savings motivation.Secondly,from the perspective of consumption types,the development of digital finance promotes household survival consumption more,and the promoting effect on household development consumption is less than that of survival consumption,indicating that the role of digital finance in promoting the upgrading of family consumption structure needs to be further improved.Finally,the empirical analysis shows that the development of digital finance has a certain alleviating effect on household consumption inequality,which is conducive to promoting consumption fairness.Chapter six analyzes the digital financial development in our country and the influence of household wealth accumulation,compared to income and consumption,the accumulation of wealth takes longer,the analysis of the digital financial development impact on household income and consumption,further analyzes the digital whether financial development promotes our country household wealth accumulation,whether different types of wealth has a significant positive influence.The results show that the development of digital finance has significantly promoted the growth of household wealth in China,not only promoting the increase of household financial assets but also promoting the increase of household nonfinancial assets.From the perspective of group differences,the promoting effect of digital finance on household wealth accumulation is consistent with income.That is,the development of digital finance plays a stronger role in promoting the accumulation of household wealth in traditional financial developed areas such as high wealth levels,high education levels,and urban and first-tier cities.Finally,the results of the empirical analysis also show that digital financial development has not significantly reduced the wealth gap in China.Chapter seven is the conclusion and policy recommendations of this paper.From the supply end and demand end of China’s digital financial development,it puts forward the policy suggestions and measures that digital financial development can promote the improvement of Chinese family economic welfare,achieve financial inclusion and common prosperity.The innovation of this paper is mainly reflected in the following aspects:First of all,from the perspective of research,the rapid development of digital finance and the digital economy has an important impact on the economic behavior and economic welfare of families.From the perspective of digital financial development,this paper comprehensively and systematically explores the impact of digital financial development on household economic welfare,which has important theoretical and practical significance.Secondly,from the perspective of research content,existing discussions on the relationship between digital finance and household income mostly explore the welfare effect of digital finance from the perspective of the structure of total income.This paper extends the scope of welfare assessment of digital finance to income gap,and empirically tests the development of digital finance and household income gap.It has deepened the understanding that the development of digital finance affects the social economy and income distribution.Digital financial and household consumption,most studies discussed the digital financial development impact on household consumption and consumption structure,but neglected the digital financial development impact on household consumption inequality,in this paper,by constructing the highest and lowest consumption quantile ratio index,explores the development of the financial impact on household consumption inequality,digital.It enriches the research on digital finance and household consumption.In terms of household wealth accumulation,the current research about digital financial and household wealth accumulation is less,this paper not only discusses the digital financial development impact on total household wealth accumulation but also analyzes the development of the financial structure of household wealth digital and digital financial development is to reduce the influence of the family’s wealth gap in China,It enriches the research related to the development of digital finance and the accumulation of household wealth.Thirdly,most studies focus on the welfare effect of the development of digital finance,ignoring the impact of digital finance use ability and the digital divide on household economic behaviour.Based on the CHFS micro database,this paper not only comprehensively analyzes the group and regional distribution characteristics of digital equipment and digital finance use.This paper also reveals the current situation and causes of the digital divide problem in China from the aspects of the "digital financial access divide" and "digital financial use divide".It is very important to bridge the regional digital divide in China.Finally,at present,more research focuses on exploring the welfare effect of digital finance development,ignoring the impact of digital finance use ability and digital divide on family economic behaviour.Based on the CHFS micro database,this paper not only comprehensively analyzes the group and regional distribution characteristics of digital equipment and digital finance use,It also reveals the current situation and causes of China’s digital divide from two aspects: "digital finance access divide" and "digital finance use divide",which is of great significance for bridging the regional digital divide,giving play to the inclusive effect of digital finance and achieving the strategic goal of common prosperity in China.