Is Financial Risk A Stumbling Block to the Development of Digital Economy? A Global Case

Abstract

ABSTRACT This paper constructs a series of digital economy indexes and explores the impact of financial risk on the development of the global digital economy based on panel data of 121 countries for the period 2003–2019. Furthermore, we analyze regional heterogeneity and asymmetry. The main findings indicate that: (1) an increase of financial risk by 1% can impede the development of the global digital economy by 0.085%; (2) in high-income, upper-middle income, and lower-middle income countries, financial risk negatively affects the global digital economy; (3) financial risk has shown a significantly negative impact on the digital economy from 2009 to 2019; and (4) the financial risk has higher negative effects on the digital economy at the lower quantiles.