FANG Fuqian, XING Wei：The U-shaped Relationship Between Household Consumption and E-commerce Market Scale

Abstract：In recent years, the rapid growing e-commerce market plays an increasingly important role to Chinas economic development.However, few literatures have studied the relationship between ecommerce market development and household consumption, let alone the different influence at different stages.Based on the searching theory, we construct a dynamic general equilibrium model with price stickiness and conduct an empirical research based on the provincial panel data from 2007 to 2013 in China.The conclusions are shown as follows: the development of e-commerce market has promoted the consumption by raising the marginal utility of consumption and the degree of competition; the early stage of the development of e-commerce market is the replacement of traditional market, and the growth stage is the process of creating new markets, so there is a U-shaped relationship between the per capita consumption, aggregate consumption and e-commerce market sale.

Key words： E-commerce Market    Household Consumption    Aggregate Consumption    Search Cost

source:Finance & Trade Economics ,No.11,2015