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The spatiotemporal effects and mechanisms of digital inclusive finance on industrial structure upgrading

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  • Liu, Guang
  • Cao, Zhoutong

Abstract

Upgrading the industrial structure is central to high-quality economic development, yet its spatial relationship with digital inclusive finance remains underexplored. Using the panel data of 273 Chinese prefecture-level cities from 2011 to 2021, this study analyzes the spatio-temporal evolution and spatial interactions of digital inclusive finance and industrial structure upgrading. We find that both digital inclusive finance and industrial upgrading exhibit sustained growth and significant spatial clustering. Digital inclusive finance promotes local industrial upgrading but generates negative spillovers for neighboring cities, indicating a spatial siphon effect. Among its dimensions, coverage breadth and usage depth stimulate local upgrading while constraining nearby regions, whereas digitalization mainly produces negative spillovers. This spatial siphon effect is more pronounced in the eastern region and weaker in the central and western regions. Mechanism analysis indicates that digital inclusive finance advances industrial upgrading through technological innovation and income growth. These findings remain robust even after adjusting for the spatial weight matrix and core variables, and controlling for endogeneity. This study sheds light on the spatial transmission channels linking digital inclusive finance and industrial upgrading and provides implications for coordinated regional development.

Suggested Citation

  • Liu, Guang & Cao, Zhoutong, 2026. "The spatiotemporal effects and mechanisms of digital inclusive finance on industrial structure upgrading," Structural Change and Economic Dynamics, Elsevier, vol. 79(C), pages 342-353.
    • Handle: RePEc:eee:streco:v:79:y:2026:i:c:p:342-353
    DOI: 10.1016/j.strueco.2026.05.012
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