The role of government support on E-commerce and firm innovation during pandemic crisis

ABSTRACT

The aim of this study is three-fold first, to examine the relationship between government support and E-commerce adoption. Second, to investigate the nexus between government support and firm innovation. Third, to explore the relation of firm performance with E-commerce adoption and innovation. Using firm-level data from 31 countries during the time of COVID-19 pandemic, we find both E-commerce adoption and innovation are positively associated with government support. Further, we also find that such firms register significantly higher sales growth. The result remains consistent even after addressing the endogeneity issue. These results hold for the subsample of SMEs as well. © 2023 Economic Society of Australia, Queensland