Association between Regional Digitalization and High-Quality Economic Development

Abstract

Regional digitization became an important driving force for high-quality economic development. Digital empowerment can effectively balance factor supply and demand and promote high-quality economic development. This study selects a sample of Chinese cities from 2011 to 2018 to investigate the association between regional digitalization and high-quality economic development. This study further examines the non-linear relationship between regional digitalization and high-quality economic development using market and government governance as threshold variables. This study uses a two-way fixed effects model with a threshold effects model for the econometric analysis. The study finds that regional digitalization effectively contributes to high-quality economic development from three major changes: quality, efficiency, and power. Thresholds of effective markets and productive government characterize the impact of regional digitalization on quality economic development. The more effective the marketization process or the building of a productive government, the more effectively the digitization of the region contributes to high-quality economic development. The contribution of this paper is to reveal the internal logic of the regional digitalization process in advancing quality economic development and to provide new theoretical evidence for action plans to strengthen the construction of efficient markets and responsive government.