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E-commerce Development and Entrepreneurship in the People’s Republic of China

Author

Listed:
  • Bihong Huang

    (Asian Development Bank Institute)

  • Mohamed Shaban

    (Asian Development Bank Institute)

  • Quanyun Song

    (Asian Development Bank Institute)

  • Yu Wu

    (Asian Development Bank Institute)

Abstract

We utilize an e-commerce development indicator in tandem with big data to measure the variations of e-commerce development across counties in the People’s Republic of China and assess its impact on entrepreneurship in both rural and urban areas. We find that households living in counties with higher levels of e-commerce development are more likely to run their own businesses. Further study indicates that e-commerce development not only significantly increases the entry of new startups but also decreases the exit of incumbent businesses. We also find that e-commerce development induces sectoral change of household entrepreneurship. It promotes entrepreneurship in the manufacturing and wholesale sectors, but reduces the entrepreneurship in the retail, hotel, and catering sectors. We also show that e-commerce prosperity fuels entrepreneurship by alleviating the financial constraints and moderates the reliance of household entrepreneurship on social networks.

Suggested Citation

  • Bihong Huang & Mohamed Shaban & Quanyun Song & Yu Wu, 2018. "E-commerce Development and Entrepreneurship in the People’s Republic of China," ADBI Working Papers 827, Asian Development Bank Institute.
    • Handle: RePEc:ris:adbiwp:0827
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    References listed on IDEAS

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    Cited by:

    1. Santitarn Sathirathai & Voraprapa Nakavachara, 2019. "Connecting Locals to Locals: Market Discovery through E-Commerce," PIER Discussion Papers 118, Puey Ungphakorn Institute for Economic Research.

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    More about this item

    Keywords

    e-commerce development; big data; entrepreneurship;
    All these keywords.

    JEL classification:

    • L81 - Industrial Organization - - Industry Studies: Services - - - Retail and Wholesale Trade; e-Commerce

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