The impact of digital economy on regional resource allocation efficiency: an analysis based on resource flow speed and direction

Limuge Qi, Lan Yang and Mier Ta

Finance Research Letters, 2025, vol. 82, issue C

Abstract: Using provincial panel data from 2013 to 2022, this paper empirically investigates the impact of the digital economy on regional resource allocation efficiency and its underlying mechanism. Results show that the digital economy can break the barriers of time and space, thus enhancing regional resource allocation efficiency. Mediation effect tests reveal that with the enhancement of internet technology and services, the digital economy can enhance transaction efficiency and accelerate resource flows, thereby ultimately improving regional resource allocation efficiency. The development of the digital economy also increases the level of competition among regional firms and promotes the flow of resources toward more efficient sectors to improve resource allocation efficiency. Heterogeneity tests indicate that in comparison to regions having lower levels of financial development, those having lower levels of marketization, and China’s central and western regions, the digital economy has a more significant promoting effect on resource allocation efficiency in regions with higher levels of financial development, those with higher levels of marketization, and in China’s eastern region.

Keywords: Digital economy; Resource allocation efficiency; Transaction efficiency; Inter-firm competition (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:82:y:2025:i:c:s1544612325009031

DOI: 10.1016/j.frl.2025.107644

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