Digital Financial Inclusion and Heterogeneity in Household Portfolio Choice —‍Evidence Based on Random Effect Tobit Model

Abstract

Financial inclusion in China has witnessed diversified development, especially with the vigorous promotion of digital financial inclusion by the government, leveraging Chinese digital technology. Previous studies have shown that digital financial inclusion stimulates household consumption and entrepreneurship. However, its impact on household portfolio choices remains a question. This study analyzes the effects of digital financial inclusion on risky asset allocation from a heterogeneous perspective, using the Beijing University Digital Financial Inclusion Index and China Household Finance Survey (CHFS) data. The findings indicate that digital financial inclusion significantly increases risky asset allocation for high-income households, but its impact on low-income families is relatively small. Nonetheless, it enhances financial information accessibility, particularly for low-income groups.