The Impact of Family Social Network on Household Consumption

Abstract

Based on the 2016 China Family Panel Studies (CFPS), this paper investigates the impact of China’s family social network on the total consumption level of residents and other three levels: survival consumption, enjoyable consumption and developmental consumption. The research shows: 1) Family social network has a significant effect on the consumption expenditure of residents, especially on the enjoyable consumption expenditure; 2) Social network can promote family consumption by alleviating the restriction of family mobility and demonstration effect; 3) The effects of social networks on consumption are different among different types of families. Compared with the eastern families, the social network of central and western families plays a more prominent role in promoting consumption expenditure. Families with lower income level reply heavily social network, and the effect of social network to stimulate consumption is more obvious.