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Can the digital economy promote FinTech development?

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  • Xiaohui Chen
  • Dou Yan
  • Wen Chen

Abstract

Based on theoretical analysis and both the digital economy development index and the FinTech development index, we use a time and individual two‐way fixed effects model to study the impact of the digital economy on FinTech, and the mechanism at work. Our results show that the digital economy can promote FinTech development and that this development level will increase by 12.4117 standard deviations each time the development level of the digital economy increases by one standard deviation. The underlying mechanism is that the digital economy augments the level of technological innovation to promote FinTech development; the digital economy enhances the FinTech development level by improving the quality of credit assets. Further research shows that the digital economy's promotion effect on FinTech is heterogeneous, given the proportion of agricultural loans: the higher the proportion of agricultural loans, the lower the digital economy's promotion effect on FinTech.

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  • Xiaohui Chen & Dou Yan & Wen Chen, 2022. "Can the digital economy promote FinTech development?," Growth and Change, Wiley Blackwell, vol. 53(1), pages 221-247, March.
    • Handle: RePEc:bla:growch:v:53:y:2022:i:1:p:221-247
    DOI: 10.1111/grow.12582
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    References listed on IDEAS

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    5. Mitchell A. Petersen, 2009. "Estimating Standard Errors in Finance Panel Data Sets: Comparing Approaches," The Review of Financial Studies, Society for Financial Studies, vol. 22(1), pages 435-480, January.
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    Cited by:

    1. Xiaoting Shang & Huayong Niu, 2023. "Analysis of the Spatiotemporal Evolution and Driving Factors of China’s Digital Economy Development Based on ESDA and GM-GWR Model," Sustainability, MDPI, vol. 15(15), pages 1-21, August.
    2. Mingxia Liu & Wei Jiang, 2022. "Empirical Research on the Influence Mechanisms of Digital Resources Input on Service Innovation in China’s Finance Industry," Sustainability, MDPI, vol. 14(12), pages 1-22, June.
    3. Chen, Xiaohui & Chen, Wen & Lu, Kongbiao, 2023. "Does an imbalance in the population gender ratio affect FinTech innovation?," Technological Forecasting and Social Change, Elsevier, vol. 188(C).
    4. Chen, Wen & Wu, Weili & Zhang, Tonghui, 2023. "Fintech development, firm digitalization, and bank loan pricing," Journal of Behavioral and Experimental Finance, Elsevier, vol. 39(C).
    5. Xiaohui Chen & Wen Chen & Tao Hu & Bo Yang & Jianguang Zeng, 2023. "Regional carbon efficiency and corporate cash holdings: evidence from China," Palgrave Communications, Palgrave Macmillan, vol. 10(1), pages 1-11, December.
    6. Hao Zhou & Xinyi Li & Xiaoli Li, 2023. "Can the Digital Economy Improve the Level of High-Quality Financial Development? Evidence from China," Sustainability, MDPI, vol. 15(9), pages 1-13, April.
    7. Jun Wang & Guixiang Zhang, 2022. "Can Environmental Regulation Improve High-Quality Economic Development in China? The Mediating Effects of Digital Economy," Sustainability, MDPI, vol. 14(19), pages 1-21, September.
    8. Kai Zhao & Jiaqi Yang & Wanshu Wu, 2023. "Impacts of Digital Economy on Urban Entrepreneurial Competencies: A Spatial and Nonlinear Perspective," Sustainability, MDPI, vol. 15(10), pages 1-16, May.
    9. Wen Chen, 2023. "Digital economy development, corporate social responsibility and low‐carbon innovation," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 30(4), pages 1664-1679, July.

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