Household appliance ownership and income inequality: Evidence from micro data in China

Yating Li, Yinxin Fei, Xiao-Bing Zhang and Ping Qin

China Economic Review, 2019, vol. 56, issue C, -

Abstract: As the residential sector is becoming increasingly important in the total energy consumption and appliance ownership is a significant but under-examined driver, this study investigates the relationship between income inequality and appliance ownership using panel data from the China Health and Nutrition Survey (CHNS). We find that income inequality has negative impacts on appliance penetration rate across specifications, except for the initial development stage. On average, households start adopting air conditioners at a threshold of over 60,000 (2011 RMB) based on annual income, much higher than TV, fridge and washer (8500–9000 RMB). The empirical results validate the S-shape curve of appliance established in the literature. To understand the magnitude of the impact and policy implications, we further simulate the impact of poverty alleviation and the penetration paths under inclusive versus exclusive income growth. Our results demonstrate that current poverty line is too low to achieve appliance adoption – a signal for modern life-styles. In addition, a more inclusive growth path could lead to much higher penetration for regions that have relatively low growth rate.

Keywords: Penetration rate; Income inequality; Energy consumption; Diffusion model; Chinese household (search for similar items in EconPapers)
JEL-codes: C25 Q40 Q42 (search for similar items in EconPapers)
Date: 2019
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:chieco:v:56:y:2019:i:c:2

DOI: 10.1016/j.chieco.2019.101309

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