Digital Economy and the Urban-Rural Income Gap: Theoretical Mechanism and Empirical Study

Abstract

At present, China has won a comprehensive victory in the battle against poverty, but the unbalanced development of city and countryside and regional development, and the large gap between the urban and rural income distribution have become significant obstacles for high quality economic development, which is urgent to be narrowed. This paper theoretically analyzes the impact mechanism of digital economy development on the income gap, and conducts an empirical study with 8 years provincial data of 30 provinces from 2013 in China. The result shows that the development of digital economy can narrow this gap. And this paper puts forward some countermeasures, including that the government ought to strengthen the construction of digital infrastructure in countryside, pay attention to cultivate more rural relevant talents, and accelerate the integration of traditional agriculture and digital economy, hoping this paper can provide some useful ideas to improve the China's urban-rural income gap.