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Does the digital economy development improve or exacerbate income inequality? International evidence

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  • Feng Wang
  • Shaoxin Shen

Abstract

With the fast development of the digital economy, this study concentrates on the influence of digital economy development on income inequality in 97 countries. Three results are discovered. Firstly, the digital economy development contributes to improving income inequality, but this effect is weakened by the moderating effect of globalization globally. Secondly, digital economic development improves income inequality in lower‐middle‐income and low‐income countries; while the high‐income countries and upper‐middle‐income are not significant. Thirdly, the mechanisms reducing inequality are explored in terms of generating industries with low barriers to new entrants, reducing labor market information asymmetries, and promoting human capital equalization.

Suggested Citation

  • Feng Wang & Shaoxin Shen, 2024. "Does the digital economy development improve or exacerbate income inequality? International evidence," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 45(6), pages 4012-4038, September.
    • Handle: RePEc:wly:mgtdec:v:45:y:2024:i:6:p:4012-4038
    DOI: 10.1002/mde.4231
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