Cross‐border E‐commerce Reform and Entrepreneurial Activity in Urban Services – Evidence from Chinese Service Industry Enterprise Registration Data

Xin Gao and Shuo Kong

China & World Economy, 2024, vol. 32, issue 6, 217-258

Abstract: Cross‐border e‐commerce (CBEC) significantly stimulates foreign trade development and the flow of goods and services. This study, using Chinese city‐level data and a multiperiod difference‐in‐differences model based on CBEC comprehensive pilot zones, explores the impact of CBEC reform on urban service industry entrepreneurship. The results show that CBEC reform increased entrepreneurial activity, and this is confirmed by robustness tests. The mechanisms driving this effect include the attraction of foreign direct investment, improved information infrastructure, and talent development. Regional analysis reveals stronger effects in central, western, and noncoastal cities, and industry analysis highlights public and consumer services. Spatial heterogeneity shows that the reform's impact diminished with distance from pilot zones, with potential inhibitory effects in remote areas. This study demonstrates how CBEC reform can stimulate entrepreneurship and foster economic growth.

Date: 2024
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