Digital Inclusion and Rural Earnings in Indonesia: Evidence from E-Commerce Adoption Across Sectors

Kadir Ruslan () and Weni Lidya Sukma ()
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Kadir Ruslan: BPS-Statistics Indonesia
Weni Lidya Sukma: BPS-Statistics Indonesia

Chapter Chapter 5 in E-Commerce for Inclusive Rural and Agricultural Development, 2027, pp 133-170 from Springer

Abstract: Abstract This study examines the determinants and income effects of e-commerce adoption among rural employers and employees in Indonesia, with a focus on both agricultural and non-agricultural sectors. Using nationally representative labor force data from 2018 to 2024, we applied Endogenous Switching Regression (ESR), Propensity Score Matching (PSM), and Inverse Probability Weighting with Adjusted Regression (IPWRA) methods to assess the income impacts. Results show that education, training, and sectoral affiliation significantly influence adoption. Notably, adoption remains lower among agricultural workers. E-commerce adoption is associated with substantial income gains across all groups, particularly among agricultural and non-agricultural employers. Quantile regression results indicate that lower-income workers gain the most, suggesting e-commerce can reduce rural income inequality. However, Blinder-Oaxaca decomposition reveals persistent gender earnings gaps, with adoption alone insufficient to eliminate disparities. These findings underscore the necessity for inclusive digital strategies that extend beyond infrastructure, emphasizing digital literacy, targeted training, and gender-sensitive policies to foster equitable rural development.

Keywords: E-commerce; Digital inclusion; Rural labor; Income inequality; Gender gap; Indonesia (search for similar items in EconPapers)
Date: 2027
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Persistent link: https://EconPapers.repec.org/RePEc:spr:conchp:978-981-92-5237-4_5

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DOI: 10.1007/978-981-92-5237-4_5

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