Study on the Mechanism of the Impact of the Digital Economy on Common Prosperity

Common prosperity is an essential requirement of socialism and an important feature of Chinese modernization, and how the digital economy, as a core driving force of economic growth, empowers the common prosperity through the new quality of productivity has become an urgent issue to be explored. Based on the panel data of 30 provinces in China from 2014 to 2022, this paper explores the relationship between the digital economy, new productivity and common prosperity, and empirically examines the mechanism of the digital economy’s impact on common prosperity and its spatial spillover effect. The study finds that: (1) the digital economy significantly contributes to the increase of common prosperity, which is proved to be reliable by the endogeneity and robustness tests; (2) the NQP plays a partly intermediary role in the relationship between the digital economy and common prosperity, that is to say, the digital economy indirectly contributes to the common prosperity through the promotion of the development of NQP; (3)There is regional heterogeneity in the contribution of the digital economy to the common prosperity, with a significant contribution in the central and western regions, but not in the eastern region; (4) the digital economy has a positive spatial spillover effect on common prosperity, and it can raise the level of common prosperity in neighboring provinces and municipalities.