19 pages., via online journal., Agricultural e‐commerce clusters are new phenomena that have emerged in rural China. In examining the case of Shuyang County in Jiangsu Province, this paper puts forward an integrated model revealing the formation mechanism of agricultural e‐commerce clusters. The paper shows that the formation of agricultural e‐commerce clusters involves four processes of technology introduction, technology diffusion, quality crisis, and industrial agglomeration based on elements such as industry bases, e‐commerce platforms, network facilities, logistics services, entrepreneurial talent, local government, and market demand. Rural social networks and imitation behaviors promote technology diffusion by reducing the cost of technology introduction, and industrial agglomeration is found in the economies showing a deepening of labor divisions and geographic agglomeration. Throughout the formation process, a quality crisis may occur due to a race to the bottom and the opportunistic behaviors of local farmers. This work suggests that regional e‐commerce development is a systematic project. Governments of developing countries should not only realize the positive impacts of e‐commerce for the development of the agricultural industry but also recognize the premise and logic of how e‐commerce can play a prominent role.
