Journal Article

Assessing the Gains from E-Commerce

Levin, Larry, Dolfen, Paul, Best, Wayne, Klenow, Peter J., Klopack, Benjamin, Einav, Liran, Levin, Jonathan D.

2023

Overview

E-commerce represents a rapidly growing share of consumer spending in the United States. We use transactions-level data on credit and debit cards from Visa, Inc. between 2007 and 2017 to quantify the resulting consumer surplus. We estimate e-commerce reached 8 percent of consumption by 2017, yielding the equivalent of a 1 percent boost to their consumption, or over $1,000 per household per year. While some of the gains arose from avoiding travel costs to local merchants, most of the gains stemmed from substituting to merchants available online but not locally. Higher income consumers gained more, as did consumers in more densely populated counties.

• Publisher: American Economic Association