How Does Digital Economy Affect Rural Revitalization? The Mediating Effect of Industrial Upgrading

Tao Cen, Shuping Lin () and Qiaoyun Wu
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Tao Cen: College of International Economics & Trade, Ningbo University of Finance & Economics, Ningbo 315175, China
Shuping Lin: College of International Economics & Trade, Ningbo University of Finance & Economics, Ningbo 315175, China
Qiaoyun Wu: College of Wealth Management, Ningbo University of Finance & Economics, Ningbo 315175, China

Sustainability, 2022, vol. 14, issue 24, 1-13

Abstract: Since the reform and opening up in 1978, China’s economy has grown significantly, but rural development still lags. China has implemented a rural revitalization strategy to reduce the gap between urban and rural areas. Meanwhile, the digital economy has gradually become a new economic growth engine for China. With the digitalization of rural industries, the digital economy gradually integrated into rural development and revitalization. However, how the digital economy impacts rural revitalization remains unclear. Based on the entropy method, previous studies measured rural revitalization levels from the perspectives of economy, civilization, and ecological environment. In this paper, using panel data from 11 prefecture-level cities in Zhejiang Province from 2011 to 2019, we use the entropy method to quantify the development level of the digital economy, industrial upgrading, and rural revitalization. Then, we investigate the relationship among them using fixed effect regression. The empirical results show that the digital economy obviously promotes rural revitalization. The mediation effect test shows that industrial upgrading plays a mediating mechanism between the digital economy and rural revitalization. In addition, heterogeneity analysis reveals that the promotion effect of the digital economy on rural development in southwestern Zhejiang is stronger than that of northeastern Zhejiang. The results imply that government should strengthen digital infrastructure construction in rural areas to promote rural revitalization. Moreover, rural areas with different economic development levels should implement a differentiated rural revitalization strategy.

Keywords: digital economy; industrial upgrading; rural revitalization; mediating effect (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (12)

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