Consumption patterns of entrepreneurs in the People's Republic of China

Kong Wing, Clement CHOW, Ka Yiu, Michael FUNG, Hang Yue NGO

Research output: Journal PublicationsJournal Article (refereed)

8 Citations (Scopus)

Abstract

Since the implementation of economic reforms in 1978 in the People's Republic of China, entrepreneurs have emerged as a new consumer group. With rising income and high consumption power, entrepreneurs have become major consumers for expensive goods and services. However, little research has been carried out to understand their consumption decisions. In this article, we study the consumption patterns of small business owners, getihu , in China by using a set of large-scale, nationwide survey data. Their consumption is postulated to be affected by (1) risk factors which include failure risk and financial (leverage) risk, (2) household variables such as the household size, financial and labor resources in the family, (3) the future plans of their business, and (4) home ownership. The effects of these factors on consumption patterns are evaluated. Our empirical results, based on regression and Tobit analysis, showed that all these factors are important in the consumption decisions of the entrepreneurs' households. In particular, risk and household factors are statistically significant in accounting for the variations in their consumption patterns. The marketing implications are also discussed.
Original languageEnglish
Pages (from-to)189-202
Number of pages14
JournalJournal of Business Research
Volume52
Issue number2
DOIs
Publication statusPublished - 1 May 2001

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Keywords

  • Consumption
  • Entrepreneur
  • Getihu

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