Impact of the Phenomenon of Taobao Villages on Local Sustainable Development

The article studies the phenomenon of Taobao villages in China and its effect on sustainable development in rural area. A Taobao village is a locality (mostly a village) where more than 10% of households run an online shop, and rural e-commerce generates more than 10 million RMB per annum. The aim of the study lies in the analysis on the key factors that lead to emergence and further development of Taobao villages. Factor analysis is used to analyze the typical patterns of development of Taobao villages. The results have shown that state and municipal government play a major role in the development of Taobao villages as recent economic incentive programs for the rural area have provided rural dwellers with telecommunication infrastructure with a free Internet connection, fiscal and direct financial stimuli. Moreover, large national corporations have stimulated e-commers with the spread of logistics and other services. These factors have helped Taobao villages to shorten economic divide between rural and urban areas