Substitution effect of lottery consumption on household risky financial asset investment – based on the moderating role of FinTech

Purpose This paper empirically examines the impact of lottery consumption on household risky financial asset investment. It further investigates the moderating role of FinTech development and the heterogeneous effects of financial literacy and regional characteristics. Design/methodology/approach Based on data from 2017 to 2019 waves of the China Household Finance Survey (CHFS), combined with lottery sales data from the Ministry of Finance of the People's Republic of China and the Peking University Digital Financial Inclusion Index, this paper employs Probit regression and a PSM-DDD approach to strengthen causal identification. Findings The results indicate that lottery consumption exerts a substitution effect on household risky financial asset investment. Moreover, the development of FinTech weakens this substitution effect through multiple channels, including reducing transaction costs in financial markets, improving information transparency, and enhancing social interaction. Heterogeneity analysis reveals that the moderating effect of FinTech is more pronounced among households located in eastern China, households residing in first-tier cities, and households with higher levels of financial literacy. In particular, the differences between households in eastern versus central and western regions, as well as between households with high versus low financial literacy, are especially significant. Practical implications Overall, the findings highlight the beneficial role of FinTech in helping households clarify the boundary between lottery consumption and financial decision-making. These results carry important implications for promoting the healthy development of the lottery market and improving the rational allocation of household assets. Originality/value This paper enriches the field of household risky financial investment, expands the relevant research on lottery consumption from a micro perspective, and provides a new perspective for understanding household financial investment decisions and the impact of lottery consumption on household risky financial investment. The results reveal the beneficial role of fintech in helping households clarify the boundary between lottery consumption and financial decisions, which is of great significance for promoting the healthy development of lottery market and rational allocation of household assets.