NBER: generative AI embedded in e-commerce software lifts small firms' monthly sales 51.6%
Afinetheorem · x · 2026-11-10
An NBER working paper (w36003) studies a leading Chinese e-commerce platform that embedded generative AI into merchants' operating software in 2024, leveraging platform-wide data. Using matched difference-in-differences and IV estimates on firms with annual sales under RMB 5 million, adoption raises monthly sales by 51.6%, driven by a 47.0% jump in orders. Adopters reach more customers, refresh product lines faster, and improve quality, with the smallest firms gaining most. Two mechanisms: lower routine-work costs (richer content, more listing updates, less staff time per order) and reduced information frictions (richer product info, biggest gains where demand is unpredictable). Commentator Afinetheorem reads it as big gains for SMEs with near-zero demand tracking — and supports his prior that AI diffuses embodied best practices, benefiting the developing world most.
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