Place, proximity and platform: The settlement system geography of Taobao village formation in China, 2014–2020

If platform-based business models are seen to disrupt traditional place-based markets and production relations, we await a fuller appreciation of their impacts on the intricate and interconnected nature of the spatial economy. This article employs panel regression models to assess the impact of distances to urban places of different sizes and of administrative boundaries on the formation of Taobao villages aggregated to the county level for 1603 counties nationwide from 2014 to 2020. Our results reveal that there are fewer Taobao villages in the regions closer to the nearest urban centre of any size or the nearest second large urban centre (when the distance to the second large urban centre is less than that to the large urban centre), suggesting that e-commerce businesses in these settings are subject to agglomeration shadow effects. However, this significant effect cannot be observed when the distance to the second large urban centre is greater than that to the large urban centre, suggesting that the shadow effects are less in these settings. Moreover, our results also reveal that provincial borders act both as barriers, allowing e-businesses to benefit from the nearest second large urban centre within the same province, and as protective shields, preventing e-businesses from the agglomeration shadow of the nearest large urban centres outside the province. In conclusion, some of the complexity of urban systems and their positive and negative effects on patterns and processes of e-commerce business formation are revealed.