Research On The Impact Of Digital Inclusive Finance On The Urban-Rural Income Gap In China

Which is characterized by the rapid development of digital technology,digital Inclusive Finance has constructed a new financial service ecosystem by utilizing digital technology.This has resulted in the development of China’s financial industry receiving both technical support and opportunities for innovation.In the 14 th Five Year Development Plan,it is proposed to promote rural revitalization with high quality,fully tap the market demand potential of both urban and rural areas,take the agricultural supply side reform as the main line of reform,promote the free and equal exchange of urban and rural production factors,and gradually solve the problems of unbalanced urban and rural development and unequal income distribution.The discussion on the influence of digital inclusive finance on income disparities between urban and rural regions in China was very important in light of this backdrop.This study investigated economic data in the provincial level regions of China,taking into consideration the effect of digital finance on the income disparity between urban and rural residents.This paper uses the economic data of 31 provinces,municipalities and autonomous regions in China for empirical analysis.Firstly,a panel regression model with fixed effects is used as a benchmark model to analyze the impact of digital inclusive finance on urban-rural income gap.Secondly,a threshold regression model is used to explore the threshold effect in the influence mechanism.Finally,Moran’s index(I)and Geary’s index(C)were used to test the spatial autocorrelation of two variables.The results show that :(1)Digital inclusive finance plays a critical role in reducing the income gap between urban and rural residents in nationwide.(2)Using economic development level as the threshold variable,it is found that there is a single threshold value,and when the economic development level exceeds this threshold value,the urban-rural income gap were scaled down by digital inclusive finance significantly.(3)Using Moran index and Geary index method for digital inclusive finance,found that Chinese provincial digital inclusive finance and income gap between urban and rural areas are a significant spatial correlation.(4)According to the findings of the research conducted using the spatial Dobbin model,it was discovered that digital Inclusive Finance in this region will help to close the income gap between urban and rural areas in this region,but it will widen the income gap between urban and rural areas in the surrounding areas.The findings presented in this study can contribute to the expansion of the relevant theoretical framework,assist the government in the formulation of targeted policies and guidelines,and serve as a reference point for the execution of Rural Revitalization and development plan in China.