Connecting Rural Households to E-Commerce

From 2000 to 2015, the number of people using the Internet to buy and sell products in China grew from practically zero to more than 400 million, with most of this growth occurring in cities. To bridge the resulting rural-urban economic divide, the Chinese government announced a policy priority of expanding e-commerce to the countryside, partnering with a large Chinese e-commerce firm to achieve this goal. This project collects survey and transaction microdata and employs a randomized evaluation across 100 villages in eight counties to track the impact of the firm’s efforts to connect rural areas to e-commerce. Researchers found that the firm’s program led to statistically significant, but economically small gains for the average rural household. Results suggest that e-commerce expansion reduces cost of living significantly for certain groups of the rural population, but evidence does not point to broad-based benefits. This provides a more nuanced set of conclusions than previous studies that policymakers can utilize.