Click it and buy happiness: does online shopping improve subjective well-being of rural residents in China?

There is a growing trend for rural residents to shop online, but little is known about how online shopping is associated with their subjective well-being. To fill this gap, in this study, we estimate the impact of online shopping on the subjective well-being of rural residents, using survey data collected from China. An endogenous ordered probit (EOP) model is employed to address the selection bias associated with online shopping. The empirical results reveal that online shopping significantly increases rural residents' happiness and life satisfaction. The more rural residents spend on online shopping, the happier they are. Disaggregated analysis indicates that online shopping has greater positive impacts on the subjective well-being of lower-income residents (at household income tertile 1), relative to their higher-income counterparts (at household income tertiles 2-3). Our findings suggest that developing rural-targeted online shopping markets can improve the subjective well-being of rural residents and boost rural consumption upgrading.