Ok, not to offend the other people that have contributed, but they haven't really said anything useful. As a seller on ebay, craigslist, and kijiji I have come across mannnnnnny scammers, just have to learn to read between the lines and most importantly don't get greedy. In your case, HERE is what your do.
You used PayPal, GOOD. PayPal has built in insurance. You file a claim, you state your case. Their customer service is prompt and they do work on their cases. I got my money back after I got scammed on ebay.
Now note that if they sent you a cheque, DO NOT deposit it in your bank. Scammers operate in a loophole. Works like this: you deposit the cheque at your bank. Your bank tells you the account doesn't exist. However, during all these transfers, the bank ends up taking the money from YOUR account.
And sorry, but the package is gone and the amount you paid for shipping is too. You could call USPS and speak to management, tell them your situation, see what they can do. Maybe you can get them to ship it back and offer to pay shipping (of course)
Finally, some tips:
-NEVER deal with anyone from Nigeria, South Africa, or any part of Africa really. That's a ruse so American authorities can't find the guy
-If they offer you more money than you asked for and you feel its too good to be true, it is.
-They will throw excuses at you saying its a gift for their sick/poor/needy nephew/cousin/brother.
-NEVER deal thru anything else than PayPal. Western Union is their cesspool.
-Also, try to keep it local, or even national, and don't ship until the money is in your hands.
I hope this helps. Luck.