Local spillovers and durable adoption: evidence from durable consumptions in rural China

Zhao Rong and Yao Feng

China Agricultural Economic Review, 2014, vol. 6, issue 1, 158-174

Abstract: Purpose - – The effects of social learning and network externalities in the diffusion of a new product imply that there should be local spillovers from existing owners to new adopters in a closely related community. Using the data from a unique household survey in rural China, this paper aims to examine the importance of local spillovers in the diffusion of two major durable goods, washing machine and refrigerator. Design/methodology/approach - – Based on a 1999 rural household survey of durable goods consumption conducted by the National Bureau of Statistics (NBS) of China, the authors examine the likelihood of rural households adopting a washing machine and a refrigerator during 1998-1999, respectively. Findings - – The estimation results indicate that a household is more likely to buy its first durable good in villages where a large share of households already own one. Further evidence suggests that these patterns are unlikely to be explained by unobserved local characteristics. When examined in more detail, the extent of local spillovers appears to be positively related to the household education level. Originality/value - – First, the study reveals the importance of local spillovers in the diffusion of these two durables. Specifically, 64 percent of washing machine adoptions during 1998-1999 are due to these spillovers. For refrigerator adoptions, the proportion is 55 percent. Second, to the authors' best knowledge, the authors are among the first to test and provide evidence on the interaction between education level and local spillovers based on the learning hypothesis.

Keywords: China; Durable adoptions; Education level; Local spillovers; Rural households (search for similar items in EconPapers)
Date: 2014
References: Add references at CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
https://www.emerald.com/insight/content/doi/10.110 ... d&utm_campaign=repec (text/html)
https://www.emerald.com/insight/content/doi/10.110 ... d&utm_campaign=repec (application/pdf)
Access to full text is restricted to subscribers

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:eme:caerpp:v:6:y:2014:i:1:p:158-174

DOI: 10.1108/CAER-02-2012-0019

Access Statistics for this article

China Agricultural Economic Review is currently edited by Dr Fu Qin, Dr Jikun Huang, Dr Kevin Z Chen, Dr Weiming Tian, Prof Daniel Sumner, Prof Xian Xin and Prof Holly Wang

More articles in China Agricultural Economic Review from Emerald Group Publishing Limited
Bibliographic data for series maintained by Emerald Support ().