Effect of Household Structure Changes on Consumption Inequality: An Empirical Study from Household Data in China

Abstract

Based on the China Family Panel Studies (CFPS) data from 2012 to 2022, this study systematically investigates the impact of household structure changes on consumption inequality and its underlying mechanisms. Against the backdrop of China’s economic transformation and demographic transition, the study integrates the Recentered Influence Function (RIF) regression with the RIF–Oaxaca–Blinder decomposition to identify the unconditional marginal effects of different household structure types—including six categories such as single-person households, compound households, and couple-only nuclear households—on consumption inequality. It further reveals the relative contributions of compositional (structural) and behavioral (coefficient) effects to the evolution of inequality. The findings show that the diversification of household structures has significantly intensified consumption inequality, particularly in high-level consumption categories such as healthcare, culture, education, and entertainment. Income and wealth disparities serve as the main amplification channels, while differences in saving behavior reflect unequal risk-sharing capacities. The heterogeneity analysis reveals that the inequality-enhancing effect of household structural changes is more pronounced among urban households, insured households, and those in the eastern and central regions. Dynamic decomposition results further demonstrate that the widening of consumption inequality is primarily driven by behavioral effects rather than compositional shifts. Overall, from a micro-behavioral perspective, this study uncovers the transmission mechanisms through which household structure changes amplify consumption inequality, providing new theoretical insights and empirical evidence for understanding consumption stratification and promoting inclusive upgrading amid demographic transition.