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Digital revitalization or useless effort? Public e-commerce support and local specialty sales

Author

Listed:
  • Han, Xintong
  • Dee, Jan Victor
  • Wang, Shaojia
  • Chen, Kefan

Abstract

We examine how a government-initiated e-commerce platform (GEP) affects sales of a local specialty in China’s Pu’er tea market. Using a unique dataset from field experiments and surveys of 983 farmers, we examine changes in online and offline sales over time. We employ two-way fixed effects (TWFE) models to identify the causal impact of GEP access. The results reveal significant substitution effects: access to the GEP increases online sales by 16.649% and decreases offline sales by 15.549%, indicating an overall shift from offline to online sales. On the extensive margin, households that previously sold only offline become more likely to sell online. On the intensive margin, adopters expand their online channels and offer a wider range of tea qualities. The mediation analysis suggests that the increase in online sales channels and product variety accounts for the impact of GEP access on the shift to online transactions.

Suggested Citation

  • Han, Xintong & Dee, Jan Victor & Wang, Shaojia & Chen, Kefan, 2026. "Digital revitalization or useless effort? Public e-commerce support and local specialty sales," Journal of Development Economics, Elsevier, vol. 179(C).
    • Handle: RePEc:eee:deveco:v:179:y:2026:i:c:s0304387825002160
    DOI: 10.1016/j.jdeveco.2025.103665
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    Keywords

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    JEL classification:

    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
    • L81 - Industrial Organization - - Industry Studies: Services - - - Retail and Wholesale Trade; e-Commerce
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
    • Q13 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Markets and Marketing; Cooperatives; Agribusiness

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