Digital economy, land resource mismatch, and urban housing costs: Evidence from China's digital governance policy perspective

Abstract

Live in peace and work in contentment" encapsulates people's aspirations within a digital economy framework. Has the digital economy truly realized this ideal? To answer this query, this paper delves into the correlation between the digital economy, resource mismatch, and urban housing costs across 272 Chinese cities. It evaluates the impact of policies propelled by the digital economy, using the “Broadband China” strategy as a benchmark. The findings suggest several key conclusions: (i) The imbalance in land resources exacerbates the digital economy's impact on escalating urban housing expenses. This effect is particularly pronounced in cities within the Yangtze River Economic Zone, cities experiencing low economic growth rates, large cities with high employment levels, and cities with relatively low wages. (ii) The rise of the digital economy has contributed to increased urban housing costs. For every 0.1 unit increase in a city's digital economy level, there is an observed average rise of 9.87% in housing costs. (iii) Policies steered by the digital economy, such as the "Broadband China" strategy, have significantly increased urban housing costs. A higher degree of resource mismatch correlates with a more pronounced impact of the “Broadband China” strategy pilot in elevating urban housing expenses. It is imperative to emphasize the qualitative ramifications of the digital economy. This should coincide with efforts to enhance resource utilization efficiency, aiming to mitigate the adverse effects of the digital economy's advancement on housing costs.