Transformations  in
Business & Economics

CAN E-COMMERCE IMPROVE THE PROFITABILITY OF AGRICULTURAL CO-OPERATIVES?⁸
Chi Liang, Ye Xingqing, Jiliang Ma

ABSTRACT. In 2020, COVID-19 has exerted a significant impact on the sale of agricultural products in China. Against this background, the e-commerce has played an important role in solving this problem.
Therefore, it has once again become the focus of attention of the Chinese government and researchers. The co-operative is an important channel for Chinese farmers to sell agricultural products, and thus, it is a vital research issue to discuss whether the application of e-commerce in the co-operative is conducive to the improvement of its profitability. This study therefore uses Logit model to analyze the factors affecting the use of e-commerce in co-operatives and PSM model to calculate the impact of e-commerce on the profit margin of co-operatives. The following conclusions can thus be drawn: (1) The gender and education level of decision-makers and the degree of processing and relevant certification of products are important influencing factors, (2) e-commerce can significantly improve the profit margin of co-operatives, and (3) e-commerce plays a more significant role in improving the profit margin of co-operatives selling primary processed products. These study conclusions are based on national-level survey, and thus, the industrial policies should be formulated according to these influencing factors to support the development of e-commerce in co-operatives, especially those selling primary processed products.

KEYWORDS:  e-commerce; cooperative; profit margin; product type.

JEL classification:  C21,Q13, Q18.

⁸Funding:  This research received no external funding. Acknowledgments: Thanks to Professor Song Hongyuan, the Director of Research Center for Rural Economy that belongs to Ministry of Agriculture and Rural Affairs of the People's Republic of China, who provide data support for this article. Conflicts of Interest: The authors declare no conflict of interest.