Digital economy development and the urban-rural income gap: Evidence from Chinese cities

Abstract

The growth of the digital economy has created new forms of inequality of opportunity. This paper studies whether the development of the digital economy expands the income gap between urban and rural areas from theoretical and empirical. The research based on the panel data of 202 cities from 2011 to 2019 in China shows that: (1) Although the digital economy can promote the improvement of both urban and rural absolute income levels, it has a greater positive impact on urban residents’ income levels than on rural residents’, resulting in a widening of the urban-rural income gap. (2) The analysis of the action mechanism reveals that employment in the information service industry and the depth of digital finance use are two crucial mechanisms for the digital economy to widen the income gap between urban and rural areas. (3) The spatial Durbin model(SDM) and the spatial error model(SEM) based on three spatial weight matrices show that the impact of the digital economy on the urban-rural income gap is also characterized by spatial spillover, and the development of the digital economy will also have a negative impact on the urban-rural income gap in neighboring regions as well. (4) The main conclusions still hold after the robustness of quasi-natural experiments based on the strategy of "Broadband China" and the selection of historical data as instrumental variables. This research is helpful to understand the effects, mechanisms and spatial characteristics of digital economy on urban-rural income gap.

Research on Theoretical Mechanism and Promotion Path of Digital Economy Driving China’s Green Development under “Double Carbon” Background

“…The use of digital technologies has greatly facilitated technical and managerial convenience in government environmental regulation and governance. Through the application of digital technology, it can promote multi-sectoral information communication and multi-agent coordination and command, effectively improve the government's environmental pollution supervision level for enterprises and the government's propaganda ability for the public to protect resources and the environment and play a role in environmental governance and protection [62]. Therefore, the following hypothesis is made.…”

The Impact of the Digital Economy on Urban House Prices: Comprehensive Explorations

“…The number of post offices has the following effects on the development of the digital economy: first, more post office coverage can drive remote and rural residents to participate in the digital economy (Huang et al, 2019). Where other digital service infrastructures are lacking, post offices, as traditional service providers, can provide residents with access to the digital economy, facilitating their participation in online shopping, digital payments, and other digital transactions (Deng et al, 2023). From this perspective, there is a correlation between the distribution of post offices and the development of the digital economy.…”

Global Value Chain Participation, Employment Structure, and Urban–Rural Income Gap in the Context of Sustainable Development

“…Foreign direct investment is beneficial for rural residents to improve their employment and human capital levels, which in turn affects the URIG [70]. Financial development efficiency (Fin) is expressed as the ratio of the balance of loans to the balance of deposits from banking financial institutions in each province [71]. An increase in financial development efficiency results in more deposits being converted into loan outflows, which energizes regional productive activities and, thus, affects the URIG.…”