The Effect of the Online Experience on Household Consumption Expenditure in the European Union
Document Type Thesis
Advisor: Anna Shostya
This study aims to explore the elements of the online user experience that have helped firms like Apple, Alphabet, Microsoft, Amazon, and Facebook become world giants in terms of market capitalization. I use data from Eurostat to investigate the impact of mobile device usage, social media participation, usage of online communal learning sites, customer product reviews, and the national presence of Amazon Prime on final consumption expenditures of households in the European Union. I employ Expected Utility Theory as a theoretical framework to explain consumer behavior associated with online purchases and online sources for product information. I seek to answer the following questions: How does the presence of the resources allotted by the world’s wealthiest retailer influence purchasing? Does the use of online social media reflect consumers’ buying habits? And finally, what are some potential benefits and challenges associated with an online consumption experience? I use the Ordinary Least Square method to estimate a linear model, in which median net income and gross domestic product are held as control variables. I expect mobile device usage, social media participation, usage of online communal learning sites, and the presence of Amazon Prime to have a positive effect on the consumption expenditures.