Does the application of ICTs facilitate rural economic transformation in China? Empirical evidence from the use of smartphones among farmers

Abstract

This paper investigates the role of information communication technologies (ICTs) in the transformation of rural economies by evaluating the use of smartphones among farmers in China. We use unique three-wave panel data to document the transformation path of rural economies in recent years. An endogenous switching probit model and a counterfactual analysis are applied to estimate the effects of smartphone use. The results show that from 2008 to 2015, rural economies in China could be characterized by the following three aspects: a) increased off-farm employment, b) expanded grain cultivation, and c) decreased crop diversification. The estimation results indicate that the use of smartphones among farmers had significant impacts on the transformation of rural economies by facilitating the off-farm employment of the farmers' family members, the cultivation of nongrain crops and crop specialization. These findings complement the empirical evidence on the role of ICTs, particularly smartphones, in the development of rural economies in China and other developing countries.