IDEAS home Printed from https://ideas.repec.org/a/eee/finlet/v90y2026ics1544612325026108.html

Digital economy and high-quality tourism development: Roles of environmental regulations and foreign direct investments

Author

Listed:
  • Cheng, Lin

Abstract

This study investigates how digital economy (DIG) development influences high-quality tourism across 30 Chinese provinces from 2010 to 2022, using a framework that considers both mechanisms and contextual factors. High-quality tourism is assessed through a multidimensional index covering innovation, coordination, sustainability, openness, and shared benefits, while the DIG is measured through digital infrastructure, industries, and inclusive finance. Applying fixed-effects regressions, instrumental variables, and propensity score matching to address endogeneity, we find robust evidence that digital development significantly enhances tourism quality. Foreign direct investment (FDI) acts as a key mediator, with stronger digital economies attracting more FDI that improves tourism infrastructure and services. Environmental regulation further strengthens this relationship: provinces with stricter standards use digital tools more effectively for sustainable tourism, amplifying quality gains. Heterogeneity analysis shows notable disparities, eastern provinces and those more open to foreign investment experience stronger DIG–tourism linkages than western or less-open regions. These findings demonstrate that digitalization drives qualitative, not just quantitative, tourism growth and underscore the need for coordinated policies integrating digital investment, FDI facilitation, and environmental governance. Fully realizing the benefits of digital transformation in tourism requires bridging regional digital divides and fostering supportive institutional frameworks.

Suggested Citation

  • Cheng, Lin, 2026. "Digital economy and high-quality tourism development: Roles of environmental regulations and foreign direct investments," Finance Research Letters, Elsevier, vol. 90(C).
    • Handle: RePEc:eee:finlet:v:90:y:2026:i:c:s1544612325026108
    DOI: 10.1016/j.frl.2025.109361
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S1544612325026108
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.frl.2025.109361?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to

    for a different version of it.

    References listed on IDEAS

    as
    1. Qiao Chen & Yan Mao & Alastair M. Morrison, 2021. "Impacts of Environmental Regulations on Tourism Carbon Emissions," IJERPH, MDPI, vol. 18(23), pages 1-16, December.
    2. Dai, Jiapeng & Phan Ah Kiaw, Jasmine & Yap Tat Hiung, Eddy, 2025. "Is some uncertainty better than none? Nonlinear relationships between climate policy uncertainty and corporate green performance," International Review of Economics & Finance, Elsevier, vol. 102(C).
    3. Xinna Zhao & Xuehui Mei & Zhengqing Xiao, 2022. "Impact of the Digital Economy in the High-Quality Development of Tourism—An Empirical Study of Xinjiang in China," Sustainability, MDPI, vol. 14(20), pages 1-17, October.
    4. Xinyang Wu & Xuecheng Liang, 2023. "Tourism development level and tourism eco‐efficiency: Exploring the role of environmental regulations in sustainable development," Sustainable Development, John Wiley & Sons, Ltd., vol. 31(4), pages 2863-2873, August.
    5. Shan, Yi & Ren, Zhengshi, 2023. "Does tourism development and renewable energy consumption drive high quality economic development?," Resources Policy, Elsevier, vol. 80(C).
    6. Youssef El Archi & Brahim Benbba & Moaaz Kabil & Lóránt Dénes Dávid, 2023. "Digital Technologies for Sustainable Tourism Destinations: State of the Art and Research Agenda," Administrative Sciences, MDPI, vol. 13(8), pages 1-21, August.
    7. Mao, Zhenxing (Eddie) & Yang, Yang, 2016. "FDI spillovers in the Chinese hotel industry: The role of geographic regions, star-rating classifications, ownership types, and foreign capital origins," Tourism Management, Elsevier, vol. 54(C), pages 1-12.
    8. Runguo Xu & Ugur Korkut Pata & Jiapeng Dai, 2024. "Sustainable Growth through Green Electricity Transition and Environmental Regulations: Do Risks Associated with Corruption and Bureaucracy Matter?," Politická ekonomie, Prague University of Economics and Business, vol. 2024(Spec.issu), pages 228-254.
    9. Zhou, Bingjun & Gao, Ke & Ning, Jing & Zhang, Anqi & Dai, Jiapeng, 2024. "Does air pollution change the business strategy for investment? The strategic influence of national governance," Finance Research Letters, Elsevier, vol. 63(C).
    10. repec:prg:jnlpol:v:2024:y:2024:i:2:id:1420:p:228-254 is not listed on IDEAS
    11. Zi Tang & Xiaopeng Si & Yan Liang, 2024. "Research on the measurement of high-quality development of tourism: a case study of Heilongjiang Province, China," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 26(10), pages 25027-25047, October.
    12. Min Yu & Binbin Ma & Dan Liu & Aixia Zhang, 2024. "Is the digital economy empowering high-quality tourism development? A theoretical and empirical research from China," PLOS ONE, Public Library of Science, vol. 19(5), pages 1-25, May.
    13. Hong He & Shouheng Tuo & Kewei Lei & Aixiong Gao, 2024. "Assessing quality tourism development in China: an analysis based on the degree of mismatch and its influencing factors," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 26(4), pages 9525-9552, April.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Wang, Peigen & Hu, Yingying & Wei, Na & Wu, Xiaoxu, 2026. "Dual pathways for high-quality development: The role of cultural tourism integration and digital-intelligent transformation in Chinese tourism enterprises," International Review of Financial Analysis, Elsevier, vol. 110(C).
    2. Long, Yang & Li, YanPing & Yu, Xiaotong & Zou, Siqi, 2026. "Internal pay gaps and human capital upgrading," Finance Research Letters, Elsevier, vol. 89(C).
    3. Li, Chenyuan & Zhou, Yunshui & Xiao, Jingyuan, 2026. "Does tourism development improve women's employment? evidence from belt and road countries," Finance Research Letters, Elsevier, vol. 92(C).
    4. Liu, Changqing & Mastor, Nor Hamimah, 2026. "Can data asset intensity alleviate the risk of financial distress?," Finance Research Letters, Elsevier, vol. 90(C).
    5. Zheng, Shilong & Dong, Qi & Lin, Yunshi, 2026. "Policy uncertainty effects under different ownership structures: An asymmetric analysis," Finance Research Letters, Elsevier, vol. 91(C).
    6. Yu, Bo & Chen, Chiping, 2026. "Intelligent manufacturing and firm innovation performance," Finance Research Letters, Elsevier, vol. 88(C).
    7. Liu, Zhaoyong & Zhao, Jingfang, 2026. "Digital economy-driven sports industry: The synergistic effects of data factorization and tourism upgrading," Finance Research Letters, Elsevier, vol. 92(C).
    8. Yang, Mei & Yang, Furong & Yang, Zaiyun, 2026. "Analyst forecast accuracy and corporate financial performance," Finance Research Letters, Elsevier, vol. 90(C).
    9. Runsen Yuan & Yan Li & Chunling Li & Xiaoran Sun & Lingyi Li, 2025. "The Impact of State-Owned Capital Participation on Carbon Emission Reduction in Private Enterprises: Evidence from China," Sustainability, MDPI, vol. 17(16), pages 1-39, August.
    10. Xie, Sisi & Tong, Zhenghao, 2025. "Innovation meets governance: Design patent activities’ impact on corporate success," Finance Research Letters, Elsevier, vol. 85(PE).
    11. Qiang Tu & Limei Zuo & Jianlei Mo & Yingnan Wang, 2026. "Carbon pricing, green innovation, and production efficiency—new evidence from China," Mitigation and Adaptation Strategies for Global Change, Springer, vol. 31(3), pages 1-32, March.
    12. Michael Edward Allkins & Tshepo Johannes Chauke & Portia Pearl Siyanda Sifolo, 2025. "Delivering Extraordinary Adventure Experiences During the “Chthulucene”: Circular Economy Challenges and Digital Solutions for the Environmentally Conscious Visitor," Sustainability, MDPI, vol. 17(2), pages 1-14, January.
    13. Zhenyu Zhu & Yixiang Tian & Xiaoying Zhao & Huiling Huang, 2025. "Green Washing, Green Bond Issuance, and the Pricing of Carbon Risk: Evidence from A-Share Listed Companies," Sustainability, MDPI, vol. 17(11), pages 1-23, May.
    14. Hui Wang & Huifang Liu, 2017. "An Empirical Research of FDI Spillovers and Financial Development Threshold Effects in Different Regions of China," Sustainability, MDPI, vol. 9(6), pages 1-21, June.
    15. Taotao Deng & Chen Gan & Yukun Hu, 2021. "Do hotel business benefit from increased tourist accessibility? Evidence from China’s high-speed railway program," Tourism Economics, , vol. 27(7), pages 1357-1374, November.
    16. Leyla Ergene & Nurullah Altıntaş & Muhammet Yeniyurt, 2025. "The ınfluence of financial markets, financial ınstitutions and economic growth on environmental quality and sustainability: Testing the LCC hypothesis in the case of China," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 27(8), pages 20229-20262, August.
    17. Lucília Cardoso & Carla Fraga, 2024. "Shaping the Future of Destinations: New Clues to Smart Tourism Research from a Neuroscience Methods Approach," Administrative Sciences, MDPI, vol. 14(6), pages 1-21, May.
    18. Eryu Zhang & Xiaoyu He & Peng Xiao, 2022. "Does Smart City Construction Decrease Urban Carbon Emission Intensity? Evidence from a Difference-in-Difference Estimation in China," Sustainability, MDPI, vol. 14(23), pages 1-16, December.
    19. Han, Lin & Ning, Depeng & Xin, Shiguan, 2026. "Geopolitical risk and economic growth: Evidence from ASEAN countries," Finance Research Letters, Elsevier, vol. 88(C).
    20. Liu, Sihan, 2025. "Digital transformation–productivity nexus: Platform integration and enterprise performance," Finance Research Letters, Elsevier, vol. 81(C).

    More about this item

    Keywords

    ;
    ;
    ;
    ;
    ;

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:finlet:v:90:y:2026:i:c:s1544612325026108. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/frl .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.