In emerging countries, households usually resort to micro-entrepreneurship for their livelihood and to cope with adversity, whereas social distancing measures during pandemics hinder these options. Using the dynamic capabilities framework, we analyze the conditions under which e-commerce enables household micro-entrepreneurship and livelihood resilience in times of adversity.
We assume that e-commerce capabilities have enabling and moderating effects on the relationship between distancing measures and micro-entrepreneurship in the food and accommodation sector. The hypotheses are tested in Indonesia, which implemented COVID-19-related social distancing unevenly across administrative districts. This context presents a natural experiment, which we exploit using a difference-in-differences on population survey data.
While household micro-entrepreneurship decreased on average across Indonesia, it increased significantly in districts implementing restriction measures, and household e-commerce capabilities further enhanced this effect. This reveals the enabling role of e-commerce adoption for household micro-entrepreneurship and livelihood resilience during adversity in emerging countries, with implications for theory and practice.
This paper addresses the lack of theoretical and empirical research on the enabling role of digital technologies in micro-entrepreneurial and resilience processes. More specifically, it focuses on households facing adversity in emerging countries, combining digitalization and micro-entrepreneurship to build livelihood resilience strategies.
