The Impacts of Rural E-Commerce on County Economic Development: Evidence from National Rural E-Commerce Comprehensive Demonstration Policy in China

Abstract

County economies are essential drivers of national economic development, acting as critical engines for growth and regional equilibrium. This study uses the National Rural E-commerce Comprehensive Demonstration policy, initiated by the Ministry of Finance and the Ministry of Commerce, China to empirically investigate the impact of rural e-commerce on county economic development and inequality, based on economic and night light data from 2000 to 2021. By applying a staggered difference-in-differences (DID) model, we find that rural e-commerce significantly boosts county economic development. This result remains robust after a series of robustness tests. The impact is stronger on the primary sector compared to the secondary and tertiary sectors, and the effect is more pronounced in the central and western regions than in the eastern regions. Furthermore, rural e-commerce effectively reduces economic inequality, contributing to inclusive development. Mechanistically, e-commerce into rural demonstration policy fosters county economic development by enhancing human capital mobility, accelerating logistics development, and promoting the growth of local enterprises.