Digital infrastructure and income disparities: A quasi-natural experiment based on the "Broadband China" strategy

Yongqi Feng, Jiahang Dai and Lei Zhang

International Review of Economics & Finance, 2025, vol. 102, issue C

Abstract: This study integrates digital infrastructure into the footloose entrepreneur model and employs a Difference-in-Differences (DID) approach for empirical analysis. Utilizing panel data at the national, provincial, and urban agglomeration levels in China from 2009 to 2021, it assesses the impact of digital infrastructure on income disparities. The empirical results demonstrate that digital infrastructure significantly contributes to the reduction of regional income disparities. Moreover, human capital mobility serves as a mediating mechanism in this relationship. Heterogeneity analysis further reveals that the digital infrastructure is more pronounced in eastern regions, larger cities, and areas characterized by higher levels of education and marketization. Our findings provide robust empirical evidence that digital infrastructure plays a significant role in promoting coordinated regional development, offering both theoretical insights and practical implications for advancing high-quality economic growth.

Keywords: Digital infrastructure; Income disparities; Human capital mobility; Footloose entrepreneur model; The “broadband China” strategy (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:reveco:v:102:y:2025:i:c:s1059056025005131

DOI: 10.1016/j.iref.2025.104350

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