Research On The Impact Of Digital Financial Inclusion On Common Prosperity

With the triumphant convening of the 20 th National Congress,people are paying more and more attention to common prosperity.Although China has achieved a comprehensive victory in poverty eradication,the problem of unbalanced and insufficient development in China is still acute,with large development gaps between different regions,the existence of a large number of low-income people,and the objective situation of being in the socialist stage has not changed,so the task of achieving common prosperity is still arduous and requires long-term struggle of all people to achieve common prosperity for all.With the rapid development of the Internet era,digital inclusive finance has shown its strong potential in the development process for achieving poverty eradication,promoting economic development,encouraging public entrepreneurship and supporting the real economy,so it is highly likely that digital inclusive finance is a powerful thrust for realizing full common prosperity.This paper examines the impact and effect of inclusive finance on common wealth from both theoretical and empirical perspectives.Based on the data of 31 provinces in China from 2011 to 2020,we construct a system of indicators to measure common wealth in China from three dimensions,and analyze the impact of digital inclusive finance development on common wealth and its transmission mechanism by using a panel model.And further examine the spatial spillover effect of digital inclusive finance on common affluence through the spatial Durbin model.Taking into account the actual situation of China’s digital inclusive finance development and common affluence construction,policy suggestions for using digital inclusive finance to promote the realization of common affluence in China are proposed.This has a certain reference value for China to improve residents’ income,narrow the per capita income gap and solve the Matthew effect between regions in the future.This paper finds that(1)the development of digital inclusive finance has a significant positive impact on promoting the construction of common wealth in the region.By solving the problem of financial exclusion,digital inclusive finance improves the efficiency of financial market capital financing,enabling disadvantaged groups and MSMEs to obtain loan financing;entrepreneurs who obtain loans are able to carry out entrepreneurial activities,stimulating entrepreneurial behavior,promoting economic development and providing jobs;disadvantaged groups in need of loan assistance can use loans to meet their necessary needs,enabling increased consumption,promoting economic circulation,and Small and medium-sized enterprises can use loans to finance their capital needs and maintain their normal operation,while at the same time stimulating the vitality of economic agents through increased investment,thus increasing the level of common wealth.(2)The increase in direct taxation brought about by the development of digital inclusive finance is an important reason for this positive impact.Tax reform must be further promoted to play an important role of the government in national income distribution.The increase of direct taxation can effectively solve the abnormal phenomenon of abnormally high income of part of the population,narrow the per capita income gap to a certain extent,weaken the vicious circle of the rich getting richer and the poor getting poorer,and promote social equity.(3)Digital inclusive finance has a negative spatial spillover effect on the level of common wealth in neighboring regions.This indicates that the current digital inclusive finance in China still cannot solve the existing Matthew effect,and the development level of digital inclusive finance in China still needs to be improved,especially to solve the cross-regional siphoning effect,so that financial resources can really flow to the areas in need.The innovations of this paper are:(1)Based on the research of other scholars,we establish an indicator to measure the level of common wealth,which includes the development,sharing and sustainability of common wealth,and facilitates the quantitative study of the development of common wealth in China.(2)By using panel regression model,mediating effect model and spatial econometric model to verify the positive impact of digital inclusive finance on common affluence,and using methods of replacing the explanatory variables,shrinking the tail,lagging the explanatory variables by one period and excluding some data to verify the robustness of the empirical results,we enrich the research related to inclusive finance and common affluence.(3)The role of paths and mechanisms of digital inclusive finance affecting common wealth is further studied,and the mediating role played by urban-rural income gap and direct tax level in the impact of digital inclusive finance on common wealth is investigated through a mediation model.(4)The spatial correlation and spatial spillover effects of the impact of digital inclusive finance on the level of shared affluence are revealed by using spatial econometric models,including the spatial weight matrix of geographic distance,the spatial weight matrix of economic distance,and two new spatial weight matrices that combine geographic distance and economic distance.