Title

A structural utility mediation model : China during the global financial crisis

Document Type

Journal article

Source Publication

International Journal of Economics and Finance

Publication Date

11-1-2011

Volume

3

Issue

6

First Page

141

Last Page

147

Keywords

Financial Crisis, Emotion, Saving Culture, Consumer Utility, Mediation, China

Abstract

In this paper, we analyze the effects of the 2008 global financial crisis (GFC) on consumer utility in China. Changes in consumer utility wrought by the GFC were measured by changes in consumption and income. Our empirical analysis using structural equation modeling (SEM) showed that the GFC had affected consumer utility directly and indirectly. The indirect effects were mediated by (a) the emotion or anticipatory feeling evoked by the GFC and (b) the change in saving culture or value of the Chinese. We found that route (a), but not (b), was extremely important in mediating the change in consumer utility. Contrary to conventional wisdom, the indirect effect was found to be stronger than the direct effect, pointing to the importance of the role of anticipatory feeling for assessing consumer utility. The model we obtain has a non-significant p value of 0.345 (df=9; Chi-square=10.063).

DOI

10.5539/ijef.v3n6p141

Print ISSN

1916971X

E-ISSN

19169728

Publisher Statement

Copyright © Canadian Center of Science and Education

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Recommended Citation

Voon, J. C., & Voon, J. P. (2011). A structural utility mediation model: China during the global financial crisis. International Journal of Economics and Finance, 3(6), 141-147. doi: 10.5539/ijef.v3n6p141