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Connecting the Countryside via E-Commerce: Evidence from China

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  • Victor Couture
  • Benjamin Faber
  • Yizhen Gu
  • Lizhi Liu

Abstract

This paper estimates the impact of the first nationwide e-commerce expansion program on rural households. To do so, we combine a randomized control trial with new survey and administrative microdata. In contrast to existing case studies, we find little evidence for income gains to rural producers and workers. Instead, the gains are driven by a reduction in cost of living for a minority of rural households that tend to be younger, richer, and in more remote markets. These effects are mainly due to overcoming logistical barriers to e-commerce rather than additional investments to adapt e-commerce to the rural population.

Suggested Citation

  • Victor Couture & Benjamin Faber & Yizhen Gu & Lizhi Liu, 2021. "Connecting the Countryside via E-Commerce: Evidence from China," American Economic Review: Insights, American Economic Association, vol. 3(1), pages 35-50, March.
  • Handle: RePEc:aea:aerins:v:3:y:2021:i:1:p:35-50
    DOI: 10.1257/aeri.20190382
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    Cited by:

    1. Lijuan Huang & Yi Huang & Raoyi Huang & Guojie Xie & Weiwei Cai, 2022. "Factors Influencing Returning Migrants’ Entrepreneurship Intentions for Rural E-Commerce: An Empirical Investigation in China," Sustainability, MDPI, vol. 14(6), pages 1-23, March.
    2. Guo, Di & Jiang, Kun & Xu, Chenggang & Yang, Xiyi, 2022. "Industrial clustering, income and inequality in rural China," World Development, Elsevier, vol. 154(C).
    3. Fan, Jingting & Tang, Lixin & Zhu, Weiming & Zou, Ben, 2018. "The Alibaba effect: Spatial consumption inequality and the welfare gains from e-commerce," Journal of International Economics, Elsevier, vol. 114(C), pages 203-220.
    4. Wanda Dugiel & Ewa Latoszek, 2018. "Electronic Trade in the World Trade Organization - Difficulties in Negotiating an Agreement?," The International Journal of Economic Behavior - IJEB, Faculty of Business and Administration, University of Bucharest, vol. 8(1), pages 133-143.
    5. Fan Wang & Mingfeng Wang & Shichen Yuan, 2021. "Spatial Diffusion of E-Commerce in China’s Counties: Based on the Perspective of Regional Inequality," Land, MDPI, vol. 10(11), pages 1-17, October.
    6. Lili Li & Yiwu Zeng & Zi Ye & Hongdong Guo, 2021. "E‐commerce development and urban‐rural income gap: Evidence from Zhejiang Province, China," Papers in Regional Science, Wiley Blackwell, vol. 100(2), pages 475-494, April.
    7. Tang, Ke & Xiong, Qiaoqin & Zhang, Fengyu, 2022. "Can the E-commercialization improve residents’ income? --Evidence from “Taobao Counties” in China," International Review of Economics & Finance, Elsevier, vol. 78(C), pages 540-553.
    8. Fernandes, Ana P. & Winters, L. Alan, 2021. "Exporters and shocks: The impact of the Brexit vote shock on bilateral exports to the UK," Journal of International Economics, Elsevier, vol. 131(C).
    9. Huang, Jikun & Su, Lanlan & Huang, Qiwang & Liu, Xinyu, 2021. "Facilitating Inclusive ICT Application and e-Commerce Development in Rural China," 2021 Conference, August 17-31, 2021, Virtual 313800, International Association of Agricultural Economists.
    10. -, 2021. "Post Pandemic Covid-19 Economic Recovery: Enabling Latin America and the Caribbean to better harness e-commerce and digital trade," Coediciones, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL), number 46858 edited by Eclac.
    11. Yong Qin & Yingfeng Fang, 2022. "The Effects of E‐Commerce on Regional Poverty Reduction: Evidence from China's Rural E‐Commerce Demonstration County Program," China & World Economy, Institute of World Economics and Politics, Chinese Academy of Social Sciences, vol. 30(3), pages 161-186, May.

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    More about this item

    JEL classification:

    • I31 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General Welfare, Well-Being
    • L81 - Industrial Organization - - Industry Studies: Services - - - Retail and Wholesale Trade; e-Commerce
    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development
    • O18 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure
    • P25 - Economic Systems - - Socialist Systems and Transition Economies - - - Urban, Rural, and Regional Economics
    • P36 - Economic Systems - - Socialist Institutions and Their Transitions - - - Consumer Economics; Health; Education and Training; Welfare, Income, Wealth, and Poverty

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