An empirical study on the potential of China’s cross-border e-commerce exports under the RCEP framework: an application of the extended gravity model

Abstract

The Regional Comprehensive Economic Partnership (RCEP) has opened new prospects for the growth of e-commerce across borders. In the current study, a multidimensional Cross- Border E-Commerce Index (CBECI) is created using Principal Component Analysis (PCA) and integrated into an extended gravity model to assess the potential of China’s cross-border ecommerce exports (proxy measure) to 12 RCEP member countries from 2013 to 2022. The empirical findings reveal that stronger information infrastructure, logistics performance, and digital payment systems are positively associated with China’s cross-border e-commerce export proxy, and these relationships are robust across FE, PPML, and IV-2SLS estimations. The export potential of China has steadily grown, and it has been categorized into three groups, namely, exploratory-potential (Australia, Indonesia, Malaysia, Singapore), reconstructive-potential (Philippines, Thailand, Vietnam), and significant-potential (Japan, South Korea, Laos, New Zealand). These results point to significant differences in digitaltrade preparedness among RCEP members and provide a foundation for developing differentiated e-commerce collaboration and market-expansion policies within the RCEP framework.