E-commerce Adoption and Technical Efficiency of Wheat Production in China

Dongshi Chen, Hongdong Guo, Qianqian Zhang and Songqing Jin
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Dongshi Chen: China Academy of Rural Development (CARD), Zhejiang University, Hangzhou 310058, China
Hongdong Guo: China Academy of Rural Development (CARD), Zhejiang University, Hangzhou 310058, China
Qianqian Zhang: China Academy of Rural Development (CARD), Zhejiang University, Hangzhou 310058, China

Sustainability, 2022, vol. 14, issue 3, 1-18

Abstract: Improving technical efficiency (TE) is crucial for the sustainable growth of smallholder agriculture in developing countries. While there has been a large literature investigating the determinants of smallholders’ agricultural technical efficiency, little is known about the effect of e-commerce on agriculture and crop production efficiency despite the growing importance of rural e-commerce in developing countries. This study, therefore, bridges the research gap by examining the impact of e-commerce adoption on TE using household survey data of wheat farmers in China. We employ the combination of propensity score matching (PSM) and a selectivity-corrected stochastic production frontier model to address the possible selection biases stemming from both observable and unobservable factors. We found that e-commerce adoption would lead to a 2.75 per cent increase in the technical efficiency of wheat production. Our study also complements the existing research of rural e-commerce, which mainly focuses on the benefits of e-commerce from the perspective of market opportunity and farmers’ welfare.

Keywords: e-commerce; ICT; technical efficiency; stochastic production frontier; propensity score matching; selection bias (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2022
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Citations: View citations in EconPapers (4)

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