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Abstract

In the span of just over 20 years, once small companies like Amazon have grown into major retailers that have taken substantial market-share from retail behemoths like Nordstrom and JC Penny. One of the driving factors of this shift is the adoption of online access in the vast majority of American homes. This study aims to understand how the increase in online adoption has changed consumer behavior, and whether or not the increase in internet access has pushed consumers to spend more on luxury purchases. A Random Effects Poisson regression was used to observe the effects of internet access on consumer luxury spending behavior from 2000-2016. The findings were inconsistent with the initial hypothesis, that luxury good expenditures would increase with internet access. Instead, luxury good expenditures decreased as the percentage of Americans with internet increased.

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