Using internet technology for business entrepreneurial choice: Evidence from Chinese farming households

Abstract

Entrepreneurship has the potential to stimulate employment, diversify and increase income, and foster shared prosperity. Rural farm families have harnessed the advantages of digital technologies like the internet by using them for input acquisition, new technologies, production methods, advertising and marketing, income diversification (farm and off-farm work), and entrepreneurial choices. Farm families work off-farm by engaging in self-employment and creating their off-farm businesses (entrepreneurship). This study analyzes farmers’ Internet usage in terms of entrepreneurial decisions using the 2018 China Family Panel Studies survey. The results show that Internet usage significantly promotes farmers’ entrepreneurial choice, and the estimated effects are robust. The mechanism analysis reveals that Internet usage mainly affects farmers’ entrepreneurial choices through financial capital, social networks, and risk preference attitudes. Finally, heterogeneity analysis indicates that Internet usage encourages entrepreneurial choices among farmers with higher education or family income.