Development of Digital Inclusive Finance and Urban-Rural Income Gap in Sichuan Province

Abstract

Digital inclusive finance has a great impact on reducing the cost of financial services, providing convenient financial services, alleviating poverty and other aspects. From the perspective of China's national level, it can also significantly narrow the income gap between urban and rural residents. However, few papers set the research objects of digital inclusive finance as prefecture-level cities in Sichuan Province, China. This paper uses the panel data of 18 prefecture-level cities in Sichuan Province from 2014 to 2018 as the research sample, uses the Theil index to measure the urban-rural income gap, and uses the panel fixed effect model to empirically test the impact of digital inclusive finance on the urban-rural income gap in Sichuan Province. The results show that: (1) the development of digital inclusive finance has a mitigating effect on the urban-rural income gap; (2) The mechanism test shows that digital inclusive finance in Sichuan Province mainly reduces the urban-rural income gap through the coverage breadth of digital finance and the digitalization degree of inclusive finance, while the effect of the depth of digital finance on the urban-rural income gap is not obvious.