The Effects of E-Commerce on Regional Poverty Reduction: Evidence from China's Rural E-Commerce Demonstration County Program

This paper uses the Rural E-Commerce Demonstration County (REDC) policy to estimate the effect of e-commerce on poverty reduction. We discover that the REDC policy enhanced the gross regional product per capita by 8.4 percent for the total sample of counties and 10.5 percent for a subsample of poor counties. Specifically, the REDC policy increased the aggregate final product in primary industry by 10.6 percent. The final product per capita in the secondary and service sectors was 13.1 percent and 3.3 percent higher in the REDCs than in other counties, respectively. The effects were even greater for the subsample of poor counties. The estimates demonstrate that e-commerce developed quickly in the REDCs since the implementation of the REDC policy. The income of those involved in e-commerce increased, yielding more aggregate savings deposits. The expansion of e-commerce induced more investment, suggesting that more aggregate loans are being made in REDCs. This evidence suggests new opportunities for poor people in the new digital economy.

Automated summary

This paper uses the REDC policy to examine the impact of e-commerce on poverty reduction. The findings reveal that the policy has significantly increased the gross regional product per capita, particularly in the primary industry, secondary industry, and service sector. The study demonstrates that e-commerce development in the REDCs has resulted in increased income, savings deposits, and investment, indicating new opportunities for poverty alleviation in the digital economy.