Did the Digital Push Last? E-Commerce and Rural Agricultural Earnings in Indonesia During and After COVID-19, Evidence from Sakernas

Abstract

This paper examines the impact of e-commerce adoption on earnings and income
distribution among rural agricultural employers in Indonesia, both during and after the COVID19 pandemic. Using microdata from the National Labour Force Survey/Sakernas (2018–2024)
and applying probit, OLS, Propensity Score Matching, and quantile regression models, we
identify the determinants of adoption and its impact on earnings. Adoption was strongly driven
by education, training, and enterprise characteristics, while older age and reliance on unpaid
household labor constrained uptake. Results show that e-commerce adopters earned substantially
higher than non-adopters (more than 30 percent) both during and after the pandemic, confirming
sustained income gains beyond the crisis. Quantile regressions reveal that the lowest-income
employers benefited most, with earnings gains exceeding 50 percent at the bottom quantile
during the pandemic. Although relative advantages shifted toward higher earners after the
pandemic, large and significant effects remained for the lowest-income groups. These findings
indicate that e-commerce not only enhances market access but also contributes to improving
income distribution. Policy interventions to strengthen digital literacy, rural infrastructure, and
financial access are essential to preserve its inclusive role and ensure that vulnerable agricultural
employers continue to benefit disproportionately.