Activating the longevity economy: digital literacy among older residents and household consumption structure upgrading

The longevity economy is considered to be the fastest growing model in the world, and the consumption of the older adults not only has huge potential and room for improvement in terms of quantity, but also in terms of structure. At the same time, with the increasing impact of digitization on the lives of the elderly, digital literacy has become a key factor for them to integrate into modern consumer society and improve their quality of life. Therefore, this study utilized data from Chinese Family Panel Studies(CFPS) and matched it with provincial-level macro data indicators to empirically explore the impact of digital literacy among older residents on the upgrading of household consumption structure and its potential mechanisms. The research results indicate that: (1) Digital literacy among older residents significantly promotes the household consumption structure upgrading. Specifically, for every unit of improvement in digital literacy, their consumption structure will upgrade by 1.6%. This significant result has been confirmed by rigorous endogeneity testing and robustness discussions. (2) Heterogeneity analysis found that the impact is particularly evident among older residents with shorter internet usage, receiving endowment insurance, and live in the eastern regions. (3) In terms of mechanisms, digital literacy of older residents mainly promotes the upgrading of household consumption structure by improving elderly’s mental health and reducing their precautionary savings. Given China’s current emphasis on enhancing residents’ digital literacy and skills, the insights and mechanisms presented in this article regarding the impact of digital literacy on consumption structure can provide valuable references for stimulating the longevity economy market and bridging the digital divide among the older residents.