Withholding Consumption: A Free Riding Perspective on the Diffusion of Color Television in Rural China

Zhao Rong and Lan Wu

Journal of Consumer Affairs, 2020, vol. 54, issue 2, 489-516

Abstract: This paper documents the existence of a type of local spillovers—free riding among neighbors—in the diffusion of color television sets (CTVs) in rural China. Consistent with the free‐riding hypothesis, we find that households with no TV (non‐BWTV [black and white television set] households) are less likely to buy their first CTV in villages where a higher fraction of households already own BWTVs. Consistent with the free‐riding hypothesis, we further find that this negative relationship is more pronounced for those non‐BWTV households with lower income, facing lower BWTV ownership rates, and living closer to their neighbors.

Date: 2020
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Persistent link: https://EconPapers.repec.org/RePEc:bla:jconsa:v:54:y:2020:i:2:p:489-516

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