The impact of international technology spillovers on digital inequality in China

Wei Feng and Hang Yuan

Technology in Society, 2025, vol. 81, issue C

Abstract: China's digital economy faces development bottlenecks caused by digital inequality. Does a region's ability to absorb international technology spillovers affect its digital divide? Using development data from 271 prefecture-level and above cities in China from 2014 to 2020, we employ a fixed-effects model to empirically examine the characteristics and mechanisms of international technology spillovers that affect digital inequality. We find that international technology spillovers through the import channel and outward foreign direct investment (OFDI) can widen digital inequality. Specifically, international technology spillovers through the import channel amplify digital inequality by expanding the inequality in economic growth and infrastructure, while those through the OFDI channel exacerbate it by expanding inequality in fiscal revenue and financial development. Cities across different economic regions, administrative levels, and resource endowments experience varied impacts of international technology spillovers on digital inequality. We also conduct robustness checks using the instrumental variable method and further explore spatial correlation using Spatial Durbin Model (SDM), Spatial Autoregressive Model (SAR), and Spatial Error Model (SEM). These findings enrich the study of digital inequality through the lens of international technology spillovers and encourage China to address the digital divide by fostering regional economic coordination.

Keywords: Digital economy; Digital inequality; International technology spillovers; Theil index (search for similar items in EconPapers)
JEL-codes: F43 O19 O33 (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:teinso:v:81:y:2025:i:c:s0160791x25000545

DOI: 10.1016/j.techsoc.2025.102864

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