Impact of Digital Inclusive Finance on the High‑Quality Development of Rural Economy: Evidence from China

Zhang Lu, M. Ferdous Azam S. and Tham Jacquline

Research on World Agricultural Economy, 2025, vol. 6, issue 2

Abstract: Motivated by the need to promote high-quality economic development in rural China, this study examines the impact of Digital Inclusive Finance (DIF) on rural economic development. The problem statement highlights that while rural revitalization is a key priority for the Chinese government, issues related to agriculture, rural areas, and farmers remain challenging. DIF, with its advantages of low threshold, high efficiency, and low cost, emerges as a potential solution to facilitate rural economic growth. The approach adopted in this study involves using panel datasets covering 31 provinces in China from 2011 to 2022. The study employs empirical analysis to examine the relationship between DIF and rural economic development. Specifically, it investigates how DIF contributes to innovation, coordination, green development, openness, and shared prosperity in rural areas. The data used in this study includes various indicators related to rural economic development, such as fiscal expenditure, rural human capital, social security, per capita GDP, and the urban-rural income gap. Additionally, the Peking University DIF Index, which includes coverage breadth index, usage depth index, and digitalization degree index, is used as a proxy variable for DIF. The results indicate that DIF has a significant positive impact on the high-quality development of rural economy in China. The benchmark regression results show that DIF exerts a promoting effect on rural economic development, even after controlling for various factors. Furthermore, the study finds that the impact of DIF varies across different regions, with significant positive effects observed in the eastern, central, and western regions.

Keywords: Agricultural; Finance (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:ags:reowae:410332

DOI: 10.22004/ag.econ.410332

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