Internet Purchases by Rural Residents: Implications for Community Development

Abstract

This article examines Internet purchasing patterns of rural residents by age, income, and sex to determine the characteristics of Internet purchasers and the types of stores in rural areas likely to face the most competition. The multivariate Logit analysis of 840 rural residents in the 2000 Illinois Rural Life Panel indicates that access to the Internet at home rather than work, recent changes in financial status, size of community in which people reside, age, and past experience in purchasing from mail order catalogs are important determinants of Internet purchases. The paper concludes with several implications for rural economic development including the notion that future Internet purchases may be those that already were purchasing outside the community through catalogs. Local stores can develop web pages but probably will still be disadvantaged unless they can focus on services, unique merchandise, or join cooperatives that carry a large inventory at lower prices. Main street stores may focus on customer services while accessing inventories maintained by the cooperative venture.