Poverty or pollution: The environmental cost of E-commerce for poverty reduction in China

Abstract

Pro-poor policies can have economic benefits, but they may also have environmental costs. This paper examines the impact of China's “E-commerce into Countryside” project (the ECC project), one of the world's largest targeted poverty alleviation strategies, on local air quality. The project covers approximately 100 million poor people. Using a set of difference-in-differences identification strategies, we find that the pro-poor ECC policy has consistently and significantly contributed to local air pollution, despite its role in fighting poverty. The decline in local air quality is primarily caused by the increase in rural enterprises, destruction of vegetation, and traffic pollution resulting from the intention to sell more agricultural products to the city. Pro-poor policymakers face the challenge of balancing poverty reduction with environmental protection during the process of sustainable development. When making policy decisions, it is important to consider local environmental regulations, ecological vulnerability, and potential adaptation strategies in order to weigh economic benefits against environmental costs.