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Does digital finance revitalize the countryside? The role of ESG attention and financial depth

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  • Li, Ping
  • Liang, Binyan
  • Zhao, Peng

Abstract

This study examines the role of digital financial inclusion on rural development in China, particularly the conditioning effects of local government environmental, social, and governance (ESG) awareness and regional financial depth. Drawing on 2013–2023 panel data from prefecture-level and above cities, we construct a comprehensive rural development framework spanning five dimensions and employ a two-way fixed-effects approach, along with multiple robustness checks. The results show that digital financial inclusion significantly enhances rural development, and this effect is amplified in regions with stronger ESG engagement and more developed financial infrastructure. Subdimensional analysis further indicates that usage depth and the degree of digitalization exert larger effects than coverage breadth. Heterogeneity analysis reveals that the benefits are greatest in areas with lower financial coverage and usage depth, highlighting the equalizing capacity of digital finance. However, the pattern for technological infrastructure is less conclusive.

Suggested Citation

  • Li, Ping & Liang, Binyan & Zhao, Peng, 2026. "Does digital finance revitalize the countryside? The role of ESG attention and financial depth," Finance Research Letters, Elsevier, vol. 103(C).
    • Handle: RePEc:eee:finlet:v:103:y:2026:i:c:s1544612326006586
    DOI: 10.1016/j.frl.2026.110130
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