Digital Empowerment and Rural Transformation: How Digital Rural Development Shapes Non-Agricultural Entrepreneurship in China

Abstract

Digital rural development has emerged as a crucial strategy for narrowing spatial inequalities and fostering rural transformation. However, existing literature has predominantly focused on infrastructure accessibility, often overlooking how disparities in digital capabilities shape entrepreneurial outcomes. Drawing on digital empowerment theory, this study investigates how digital rural development influences farmers' non-agricultural entrepreneurship in China. Specifically, we integrate the County Digital Rural Development Index with microdata from the China Family Panel Studies (CFPS), utilizing empirical models to identify both the impact and the underlying mechanisms. The findings show that digital rural development significantly increases the likelihood of farmers engaging in non-agricultural entrepreneurship. This effect operates through two complementary capabilities: the development of digital literacy, and the cultivation of sophisticated skills for processing and applying information, which together enable farmers to effectively leverage digital resources. In addition, the non-agricultural entrepreneurial effect is more pronounced among middle-aged and older men in eastern China, highlighting the uneven distribution of digital dividends across regions and demographic groups. By focusing on individual capability formation, this study enriches rural entrepreneurship research, and provides insights for inclusive digital strategies and rural revitalization.