RETRACTED: More digitization less inequality? Exploring the effect of digital economy on environmental inequality

Abstract

The digital economy, which relies on information technology, has emerged as a central driver of economic progress, presenting a significant opportunity to address environmental inequality. Nevertheless, theoretical research on the relationship between digital economy and environmental inequality remains limited, and the underlying mechanism remains unclear. To address this gap, we employ panel data from 268 prefecture-level cities in China between 2011 and 2020 to investigate the connection between digital economy and environmental inequality. Our findings reveal that digital economy significantly reduces the level of environmental inequality, a result that withstands robustness tests. In addition, our analysis demonstrates that this reduction is achieved through a decrease in inequalities in green finance and green technology innovation. Heterogeneity analysis further reveals that the inhibitory effect of digital economy on environmental inequity is more pronounced in eastern region, regions experiencing industry transfer out, and in regions with higher degrees of fiscal decentralization and government environmental concern. Overall, our study offers policymakers valuable insights for harnessing the potential of digital economy to promote environmental equity and achieve a harmonious balance between economic and social benefits.