Digitization, the Free Flow of Factors and the Coordinated Regional Development

Abstract

In recent years, the digitization with the big data and information technologies as the core has effectively changed the flow mode of production factors, and increasingly shows the kinetic energy and potentials of affecting the coordinated development of regions. How does data and digitization affect the flow of factors, and what paths and mechanisms are used to promote the regional coordinated development? The answers to these two questions are increasingly becoming the underlying logic of relevant academic research and policy making. Based on this, relying on the spatial configuration model (SMM), this paper establishes the digital factor flow model, which proves the "inverted U-shaped" development trend of digitization - expanding the regional development gap in the short term and bridging the gap in the long term. Subsequently, in this paper, three empirical models are established to verify the "inverted U-type" conclusion, and to further discuss the relationship between digitization, free flow of factors and the coordinated regional development. Finally, this paper puts forward that local governments should scientifically understand the role of digital factors in promoting the free flow of factors, rationally perceive potentials of digitization in bridging regional development gaps, and give full play to the role of macroeconomic regulations and guidance to improve the underdeveloped digital infrastructure, promote the inclusive development of digital economy, better serve the underdeveloped western regions in China, and finally, to promote the coordinated regional development.