How does FinTech affect the development of the digital economy? Evidence from China

Xiaohui Chen, Lei Teng and Wen Chen

The North American Journal of Economics and Finance, 2022, vol. 61, issue C

Abstract: Financial Technology (FinTech) is key to the global ascendency of China's finance, and the digital economy is a new driving force in the sustainable development and high-quality growth of China's economy. So, what is the nature of the relationship between FinTech and the digital economy. Based on the CRITIC method, this study calculates the China's 31 provinces’ (excluding Hong Kong, Macao and Taiwan) FinTech indices from 2008 to 2018 and the digital economy development indices from 2012 to 2018, and analyzes the impact of FinTech on the digital economy and its underlying mechanism. The results show that FinTech stimulates the development of the digital economy in China by promoting technological innovation and weakening the financial decentralization of local governments. Further research indicates that local financial regulatory resources have a positive moderating effect on the impact of FinTech in promoting the development of the digital economy. Increased local financial regulatory resources will enable FinTech to promote the development of the digital economy, but this regulatory role is only significant in financially developed areas. The approach of the study is relatively novel.

Keywords: FinTech; Digital economy; Influence mechanism (search for similar items in EconPapers)
JEL-codes: E00 G00 O10 (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (31)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecofin:v:61:y:2022:i:c:s1062940822000511

DOI: 10.1016/j.najef.2022.101697

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