Does digital poverty exacerbate household financial fragility?

Abstract

Household financial vulnerability has become a prominent focus in recent academic research; however, the impact of digital poverty remains underexplored. Using CFPS data from 2020 to 2022, this paper systematically investigates the effects, heterogeneity, and underlying mechanisms of digital poverty on household financial vulnerability. The baseline results indicate that digital poverty exacerbates household financial vulnerability. Heterogeneity analysis shows that this effect is particularly pronounced among urban residents, households in eastern regions, and those with highly educated household heads. Mechanism analysis reveals that digital poverty amplifies household financial vulnerability by increasing financing constraints, weakening social interactions, and reducing future expectations. This study provides a novel perspective on the causal relationship between digital poverty and household financial vulnerability and offers a theoretical foundation for designing targeted digital poverty alleviation policies.