IDEAS home Printed from https://ideas.repec.org/a/gam/jsusta/v17y2025i10p4720-d1660868.html
   My bibliography  Save this article

Rural E-Commerce and Income Inequality: Evidence from China

Author

Listed:
  • Jinwei Lv

    (School of Economics and Management, Henan Agricultural University, Zhengzhou 450046, China)

  • Xinyu Guo

    (School of International Trade and Economics, Central University of Finance and Economics, Beijing 102206, China)

  • Haiwei Jiang

    (School of International Trade and Economics, Central University of Finance and Economics, Beijing 102206, China)

Abstract

Common prosperity is the fundamental driving force of rural revitalization, as well as the foundation for achieving sustainable economic development. The e-commerce to the countryside policy has energized the rural economy, helping to improve household economic resilience and reduce income stratification, thereby promoting the inclusive and sustainable development of the digital economy. Drawing on panel data collected from rural fixed observation points in Henan Province during 2009–2022, this study employs a staggered difference-in-differences (DID) approach to evaluate the impact of China’s e-commerce to the countryside policy on farmers’ income and income inequality. The empirical results reveal that the rural e-commerce policy significantly increases farmers’ income while mitigating income inequality. The underlying mechanisms function through three synergistic pathways: industrial structural upgrading, manifested through tri-sector integration driven by rural enterprise development; factor allocation restructuring, evidenced by productivity gains from optimized labor–capital reallocation; and enhanced market inclusion through digital technology empowerment that lowers participation barriers. Heterogeneity analysis indicates that the e-commerce to the countryside policy exhibits pro-poor characteristics, with its income-enhancing and equalizing effects being particularly pronounced in agricultural areas, traditional villages, county-level civilized villages, underdeveloped regions, registered poverty-stricken villages, and households with low human, physical, and financial capital endowments. These findings confirm the inclusive development efficacy of rural e-commerce among vulnerable populations. Consequently, the study provides a replicable policy implementation framework for achieving common prosperity objectives.

Suggested Citation

  • Jinwei Lv & Xinyu Guo & Haiwei Jiang, 2025. "Rural E-Commerce and Income Inequality: Evidence from China," Sustainability, MDPI, vol. 17(10), pages 1-32, May.
    • Handle: RePEc:gam:jsusta:v:17:y:2025:i:10:p:4720-:d:1660868
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/2071-1050/17/10/4720/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/2071-1050/17/10/4720/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Klaus Deininger, 2003. "Land Policies for Growth and Poverty Reduction," World Bank Publications - Books, The World Bank Group, number 15125.
    2. Sen, Amaryta, 1999. "On Ethics and Economics," OUP Catalogue, Oxford University Press, number 9780195627619.
    3. Aloyce R Kaliba & Kizito Mazvimavi & Theresia L Gregory & Frida M Mgonja & Mary Mgonja, 2018. "Factors affecting adoption of improved sorghum varieties in Tanzania under information and capital constraints," Agricultural and Food Economics, Springer;Italian Society of Agricultural Economics (SIDEA), vol. 6(1), pages 1-21, December.
    4. Jia, Xiangping & Huang, Jikun, 2011. "Contractual arrangements between farmer cooperatives and buyers in China," Food Policy, Elsevier, vol. 36(5), pages 655-665, October.
    5. Zhiqiang Liu & Shitong Jia & Zixing Wang & Caiyun Guo & Yanqi Niu, 2022. "A Measurement Model and Empirical Analysis of the Coordinated Development of Rural E-Commerce Logistics and Agricultural Modernization," Sustainability, MDPI, vol. 14(21), pages 1-22, October.
    6. Stavros Sindakis & Gazal Showkat, 2024. "The digital revolution in India: bridging the gap in rural technology adoption," Journal of Innovation and Entrepreneurship, Springer, vol. 13(1), pages 1-28, December.
    7. Jianxin Guo & Songqing Jin & Jichun Zhao & Yuhua Li, 2023. "E‐commerce and supply chain resilience during COVID‐19: Evidence from agricultural input e‐stores in China," Journal of Agricultural Economics, Wiley Blackwell, vol. 74(2), pages 369-393, June.
    8. Ashok Mishra & Christine Wilson & Robert Williams, 2009. "Factors affecting financial performance of new and beginning farmers," Agricultural Finance Review, Emerald Group Publishing Limited, vol. 69(2), pages 160-179, July.
    9. Psacharopoulos, George, 1994. "Returns to investment in education: A global update," World Development, Elsevier, vol. 22(9), pages 1325-1343, September.
    10. Thomas Piketty, 2014. "Capital in the Twenty-First Century: a multidimensional approach to the history of capital and social classes," Post-Print halshs-01157491, HAL.
    11. Callaway, Brantly & Sant’Anna, Pedro H.C., 2021. "Difference-in-Differences with multiple time periods," Journal of Econometrics, Elsevier, vol. 225(2), pages 200-230.
    12. Jonas Hjort & Jonas Poulsen, 2019. "The Arrival of Fast Internet and Employment in Africa," American Economic Review, American Economic Association, vol. 109(3), pages 1032-1079, March.
    13. Acemoglu, Daron & Autor, David, 2011. "Skills, Tasks and Technologies: Implications for Employment and Earnings," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 4, chapter 12, pages 1043-1171, Elsevier.
    14. Liu, Nian & Qian, Yihe & Gu, Xinhua & Li, Guoqiang, 2024. "Digital technology, e-commerce, and economic inequality: The case of China," International Review of Economics & Finance, Elsevier, vol. 91(C), pages 259-271.
    15. Benedict Jun Ma & Samuel Shuai Liu & George Q. Huang & Chi-To Ng, 2025. "How does consumer quality preference impact blockchain adoption in supply chains?," Electronic Markets, Springer;IIM University of St. Gallen, vol. 35(1), pages 1-16, December.
    16. Timothy F. Bresnahan & Erik Brynjolfsson & Lorin M. Hitt, 2002. "Information Technology, Workplace Organization, and the Demand for Skilled Labor: Firm-Level Evidence," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 117(1), pages 339-376.
    17. Liupeng Chen & Yiting Wang & Yingzheng Yan & Ziwei Zhou & Bangsheng Xie & Xiaodong You, 2024. "Coupling and Coordination Development, Spatiotemporal Evolution, and Driving Factors of China’s Digital Countryside and Inclusive Green Growth in Rural Areas," Sustainability, MDPI, vol. 16(13), pages 1-31, June.
    18. Bo Liu & Jing Zhou, 2023. "Digital Literacy, Farmers’ Income Increase and Rural Internal Income Gap," Sustainability, MDPI, vol. 15(14), pages 1-13, July.
    19. Wang, Yahui & Yang, Aoxi & Li, Yuanqing & Yang, Qingyuan, 2023. "Effect of e-commerce popularization on farmland abandonment in rural China: Evidence from a large-scale household survey," Land Use Policy, Elsevier, vol. 135(C).
    20. Li, Wei & He, Weiwei, 2024. "Revenue-increasing effect of rural e-commerce: A perspective of farmers' market integration and employment growth," Economic Analysis and Policy, Elsevier, vol. 81(C), pages 482-493.
    21. Min Liu & Pengfei Shi & Jinxia Wang & Huimin Wang & Jikun Huang, 2023. "Do farmers get a greater return from selling their agricultural products through e‐commerce?," Review of Development Economics, Wiley Blackwell, vol. 27(3), pages 1481-1508, August.
    22. Tingting Huang & Bin Xiong, 2022. "Space Comparison of Agricultural Green Growth in Agricultural Modernization: Scale and Quality," Agriculture, MDPI, vol. 12(7), pages 1-17, July.
    23. Kewei Gao & Guanghua Qiao, 2025. "How Social Capital Drives Farmers’ Multi-Stage E-Commerce Participation: Evidence from Inner Mongolia, China," Agriculture, MDPI, vol. 15(5), pages 1-22, February.
    24. Hongryol Cha & Masaaki Kotabe & Jie Wu, 2023. "Reshaping Internationalization Strategy and Control for Global E-Commerce and Digital Transactions: A Hayekian Perspective," Management International Review, Springer, vol. 63(1), pages 161-192, February.
    25. Li Zhang & Dong Liu & Qie Yin & Jundi Liu, 2024. "Organic Certification, Online Market Access, and Agricultural Product Prices: Evidence from Chinese Apple Farmers," Agriculture, MDPI, vol. 14(5), pages 1-18, April.
    26. Yali Li & Ronald Marquez & Qianlin Ye & Luhua Xie, 2024. "A Systematic Bibliometric Review of Fiscal Redistribution Policies Addressing Poverty Vulnerability," Sustainability, MDPI, vol. 16(23), pages 1-23, December.
    27. Chengappa, PG, 2018. "Development of agriculture value chains as a strategy for enhancing farmers’ income," Agricultural Economics Research Review, Agricultural Economics Research Association (India), vol. 31(Conferenc).
    28. Zhang, Ning & Yang, Wantong & Ke, Haiqian, 2024. "Does rural e-commerce drive up incomes for rural residents? Evidence from Taobao villages in China," Economic Analysis and Policy, Elsevier, vol. 82(C), pages 976-998.
    29. Xiaojing Li & Apurbo Sarkar & Xianli Xia & Waqar Hussain Memon, 2021. "Village Environment, Capital Endowment, and Farmers’ Participation in E-Commerce Sales Behavior: A Demand Observable Bivariate Probit Model Approach," Agriculture, MDPI, vol. 11(9), pages 1-20, September.
    30. Ashok Mishra & Christine Wilson & Robert Williams, 2009. "Factors affecting financial performance of new and beginning farmers," Agricultural Finance Review, Emerald Group Publishing Limited, vol. 69(2), pages 160-179, July.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Bahia, Kalvin & Castells, Pau & Cruz, Genaro & Masaki, Takaaki & Pedrós, Xavier & Pfutze, Tobias & Rodríguez-Castelán, Carlos & Winkler, Hernán, 2024. "The welfare effects of mobile broadband internet: Evidence from Nigeria," Journal of Development Economics, Elsevier, vol. 170(C).
    2. Analena Bruce & Elise Neidecker & Luyue Zheng & Isaac Sohn Leslie & Alexa Wilhelm, 2025. "“A farm is viable if it can keep its head above water”: defining and measuring farm viability for small and mid-sized farms," Agriculture and Human Values, Springer;The Agriculture, Food, & Human Values Society (AFHVS), vol. 42(2), pages 625-641, June.
    3. Michał Gazdecki & Kamila Grześkowiak, 2025. "Does Financial Power Lead Farmers to Focus More on the Behavioral Factors of Business Relationships with Input Suppliers?," Sustainability, MDPI, vol. 17(17), pages 1-25, August.
    4. Iacovone, Leonardo & Pereira-López, Mariana & Schiffbauer, Marc, 2023. "Competition makes IT better: Evidence on when firms use IT more effectively," Research Policy, Elsevier, vol. 52(8).
    5. Li, Xinpeng & Wang, Xiao & Xu, Weicheng, 2022. "The information technology revolution and structural labor change: Evidence from China," Economic Modelling, Elsevier, vol. 115(C).
    6. Jin, Xin & Ma, Baojie & Zhang, Haifeng, 2023. "Impact of fast internet access on employment: Evidence from a broadband expansion in China," China Economic Review, Elsevier, vol. 81(C).
    7. Oikonomou, Myrto & Pierri, Nicola & Timmer, Yannick, 2023. "IT shields: Technology adoption and economic resilience during the COVID-19 pandemic," Labour Economics, Elsevier, vol. 81(C).
    8. Shiyi Chen & Wanlin Liu & Hong Song & Qing Zhang, 2024. "Government‐led e‐commerce expansion project and rural household income: Evidence and mechanisms," Economic Inquiry, Western Economic Association International, vol. 62(1), pages 150-174, January.
    9. T. Gries & R. Grundmann & I. Palnau & M. Redlin, 2017. "Innovations, growth and participation in advanced economies - a review of major concepts and findings," International Economics and Economic Policy, Springer, vol. 14(2), pages 293-351, April.
    10. David J. Deming, 2017. "The Growing Importance of Social Skills in the Labor Market," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 132(4), pages 1593-1640.
    11. Jeffrey L. Furman & Florenta Teodoridis, 2020. "Automation, Research Technology, and Researchers’ Trajectories: Evidence from Computer Science and Electrical Engineering," Organization Science, INFORMS, vol. 31(2), pages 330-354, March.
    12. Zhou, Yuwen & Shi, Xin, 2025. "How does digital technology adoption affect corporate employment? Evidence from China," Economic Modelling, Elsevier, vol. 147(C).
    13. Annika Campaner & John S. Heywood & Uwe Jirjahn, 2022. "Flexible work organization and employer provided training: Evidence from German linked employer‐employee data," Kyklos, Wiley Blackwell, vol. 75(1), pages 3-29, February.
    14. Irene Brambilla, 2018. "Digital Technology Adoption and Jobs: A Model of Firm Heterogeneity," Department of Economics, Working Papers 117, Departamento de Economía, Facultad de Ciencias Económicas, Universidad Nacional de La Plata.
    15. Bianchi, Nicola & Lu, Yi & Song, Hong, 2022. "The effect of computer-assisted learning on students’ long-term development," Journal of Development Economics, Elsevier, vol. 158(C).
    16. Rodimiro Rodrigo, 2022. "Robot Adoption, Organizational Capital and the Productivity Paradox," Working Papers gueconwpa~22-22-03, Georgetown University, Department of Economics.
    17. Qiang Wu, 2025. "How Does AI Affect the Pay Gap Within Firms: Mechanism Analysis Based on Personnel Structure and Corporate Investment," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 46(2), pages 717-733, March.
    18. İ. Akçomak & Lex Borghans & Bas Weel, 2011. "Measuring and Interpreting Trends in the Division of Labour in the Netherlands," De Economist, Springer, vol. 159(4), pages 435-482, December.
    19. Antonio Martins-Neto & Nanditha Mathew & Pierre Mohnen & Tania Treibich, 2024. "Is There Job Polarization in Developing Economies? A Review and Outlook," The World Bank Research Observer, World Bank, vol. 39(2), pages 259-288.
    20. Van Parys, Jessica & Brown, Zach Y., 2024. "Broadband Internet access and health outcomes: Patient and provider responses in Medicare," International Journal of Industrial Organization, Elsevier, vol. 95(C).

    More about this item

    Keywords

    ;
    ;
    ;
    ;

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:gam:jsusta:v:17:y:2025:i:10:p:4720-:d:1660868. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.