The impact of product diversity and distribution networks on consumption expansion

Chaoxun Ding, Ruidan Zhang and Xuepin Wu

Journal of Business Research, 2023, vol. 161, issue C

Abstract: Investigation on the influencing factors of consumption expansion is an important subject in business research. This study constructs a consumption utility function and analyzes the relationship between search cost and product heterogeneity and equilibrium price. Employing the data on 31 regions in China from 2002 to 2020, the panel data model is used to verify the results of the theoretical analysis. We draw the following conclusions. (1) Expanding the number of distribution outlets will lead to a decline in the equilibrium price, and an increase in product diversity prompts consumers to conduct more searches. (2) Expanding distribution networks can increase residents’ total consumption and consumption level. (3) An increase in product diversity can expand resident consumption. The conclusions suggest that distributors and retailers can increase the categories of their products, provide consumers with diversified decision-making space, and stimulate consumption expansion.

Keywords: Distribution networks; Product diversity; Resident consumption; China (search for similar items in EconPapers)
Date: 2023
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0148296323001911
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:jbrese:v:161:y:2023:i:c:s0148296323001911

DOI: 10.1016/j.jbusres.2023.113833

Access Statistics for this article

Journal of Business Research is currently edited by A. G. Woodside

More articles in Journal of Business Research from Elsevier
Bibliographic data for series maintained by Catherine Liu ().