TY - JOUR

T1 - Digital divide, craft firms’ websites and urban-rural disparities

T2 - empirical evidence from a web-scraping approach

AU - Thonipara, Anita

AU - Sternberg, Rolf

AU - Proeger, Till

AU - Häfner, Lukas Peter

N1 - Funding Information: In addition, we acknowledge the funding from the Lower Saxony Ministry of Science and Culture within the Lower Saxony “Vorab” of the Volkswagen Foundation (grant number ZN3492) and the support by the Center for Digital Innovations (ZDIN). Funding Information: The results of this study are based on the project “Digital Transformation of SMEs in the Crafts Sector of Southern Lower Saxony” by the Institute for Small Business Economics. The project was funded by the European Regional Development Fund as well as by the state of Lower Saxony (grant number ZW 6‑85017668). Open Access funding enabled and organized by Projekt DEAL.

PY - 2023/4

Y1 - 2023/4

N2 - Following the “death of distance” postulate, digitalization may reduce or even eliminate the penalty of firms being located in rural areas compared with those in urban agglomerations. Despite many recent attempts to measure digitalization effects across space, there remains a lack of empirical evidence regarding the adoption of digital technologies from an explicit spatial perspective. Using web-scraping data for a sample of 345,000 small firms in Germany, we analyze the determinants of website prevalence. Comparing urban with rural areas, we show that running a website—as a proxy for the degree of digitalization of the respective firm—is highly dependent on location, whereby firms in urban areas are almost twice as likely to run websites compared with those located in rural areas. Our county-level analysis shows that a high population density, a young population and a high educational level have a positive and significant association with the probability that firms run websites. Surprisingly, we find a negative and significant association of gross domestic product per capita with website prevalence, which is driven by urban regions. There are no differences between urban, semi-urban and rural areas in terms of website up-to-dateness as well as social media prevalence. We conclude that there is a substantial digital divide and discuss policy implications.

AB - Following the “death of distance” postulate, digitalization may reduce or even eliminate the penalty of firms being located in rural areas compared with those in urban agglomerations. Despite many recent attempts to measure digitalization effects across space, there remains a lack of empirical evidence regarding the adoption of digital technologies from an explicit spatial perspective. Using web-scraping data for a sample of 345,000 small firms in Germany, we analyze the determinants of website prevalence. Comparing urban with rural areas, we show that running a website—as a proxy for the degree of digitalization of the respective firm—is highly dependent on location, whereby firms in urban areas are almost twice as likely to run websites compared with those located in rural areas. Our county-level analysis shows that a high population density, a young population and a high educational level have a positive and significant association with the probability that firms run websites. Surprisingly, we find a negative and significant association of gross domestic product per capita with website prevalence, which is driven by urban regions. There are no differences between urban, semi-urban and rural areas in terms of website up-to-dateness as well as social media prevalence. We conclude that there is a substantial digital divide and discuss policy implications.

KW - Digital divide

KW - Digitalization

KW - Rural

KW - Small and Medium-Sized Enterprises

KW - Urban

KW - Web-scraping

UR - http://www.scopus.com/inward/record.url?scp=85134630427&partnerID=8YFLogxK

U2 - 10.1007/s10037-022-00170-5

DO - 10.1007/s10037-022-00170-5

M3 - Article

AN - SCOPUS:85134630427

VL - 43

SP - 69

EP - 99

JO - Review of Regional Research

JF - Review of Regional Research

SN - 0173-7600

IS - 1

ER -