Catalyst or Constraint? Direct Impacts and Spillovers of China’s E-Commerce Policy on Urban Spatial Restructuring via Nighttime Light Decomposition

Digital industrial policies are increasingly used to promote economic restructuring and spatial reorganization, yet their effects on urban spatial structure remain poorly understood. This study examines whether China’s National E-commerce Demonstration City (NEDC) policy acts as a catalyst for urban development or as a constraint on excessive agglomeration. Using a national sample of 293 prefecture-level cities in China from 2006 to 2020, we decompose nighttime light intensity into average intensity (overall urban development), maximum intensity (core agglomeration), and minimum intensity (peripheral activity). We employ propensity score matching, staggered difference-in-differences, and spatial Durbin models to estimate both direct effects on treated cities and spillover effects on neighboring cities. The results indicate that the policy acts as both a catalyst and a constraint. As a catalyst, the policy significantly increases average intensity and generates positive spillovers to neighboring cities. As a constraint, it reduces maximum intensity in treated cities, but this effect does not extend to neighboring cities. The effect on minimum intensity is positive but confined to treated cities. These findings are consistent with a locally confined form of digitally enabled decentralization. By decomposing nighttime light data into three metrics and examining both direct and spillover effects, this study enriches the existing literature on digital policy evaluation and urban spatial restructuring, and provides targeted infrastructure suggestions for balanced regional development.