To buy or not buy food online: The impact of the COVID-19 epidemic on the adoption of e-commerce in China

Abstract

Drawing on a recent online survey combined with city-level data, this paper examines the impact of the COVID-19 on consumers' online food purchase behavior in the short term. To address the potential endogeneity issues, we adopt an instrumental variable (IV) strategy, using the distance from the surveyed city to Wuhan as the instrumental variable. We show that our IV method is effective in minimizing potential bias. It is found that the share of confirmed COVID-19 cases increases the possibility of consumers purchasing food online. This is more likely to be the case for young people having a lower perceived risk of online purchases and living in large cities. Despite some limitations, this paper has policy implications for China and other countries that have been influenced by the COVID-19 epidemic. Specifically, government support and regulation should focus on (i) ensuring the safety of food sold on the internet, (ii) protecting the carrier from becoming infected, and (iii) providing financial support to the poor since they may have difficulties in obtaining access to food living in small cities. Moreover, how to help those who are unable to purchase food online because of their technical skills (e.g., the elderly who are not familiar with smart phones or the internet) also deserves more attention for the government and the public.