Vol.:(0123456789) Asian Business & Management https://doi.org/10.1057/s41291-020-00113-3 ORIGINAL ARTICLE Reducing poverty through the shared economy: creating inclusive entrepreneurship around institutional voids in China Jie Wu 1  · Steven Si 2  · Haifeng Yan 3 Received: 24 September 2019 / Revised: 4 February 2020 / Accepted: 3 April 2020 © Springer Nature Limited 2020 Abstract Poverty reduction has increasingly become a core subject for researchers across the social sciences from economics to finance, management, and entrepreneurship. This study goes beyond existing management and entrepreneurship literature that has devoted significant efforts to exploring market-based ways for economic develop- ment, but has neglected poor people in rural areas excluded from participating in and accessing markets. In this study, the sharing economy is proposed as an effective way to resolve and reduce the poverty problem. We show how to overcome institu- tional voids by facilitating two fundamental mechanisms (i.e., building new markets, cultivating new participants) that bring together entrepreneurship, local peasants, and governments in building inclusive markets. We reveal omitted elements, such as geographic and temporal differences in market development across regions and times, as the key source of institutional voids in emerging markets. The analyses are conducted using data from multiple sources ranging from participant observa- tion, retrieval of archival documents, and in-depth interviews covering 335 coun- ties of 16,500 villages involved with Taobao in 2007–2017 in China. The findings shed insight on the studies on institutional voids, entrepreneurship, and the sharing economy. Keywords Shared economy · Poverty reduction · Institutional voids · Inclusive markets · Rural areas Ecommerce is not for big companies or developed countries. It’s for develop- ing countries, young people and small businesses. We should not let world global trade be controlled by 60,000 big companies. We should make tech- * Jie Wu jiewu@um.edu.mo Extended author information available on the last page of the article