The impact of the digital economy on quality of life: empirical evidence from 220 cities in China

Purpose The purpose of this paper is to test if the digital economy improves the quality of life of our residents. Furthermore, if this finding is confirmed, what would be the mechanism behind its effect? Does the impact of the digital economy on quality of life vary according to its level of development? Design/methodology/approach A comprehensive index of the digital economy, income gap and quality of life was constructed empirically based on data from 220 cities in China from 2011–2020. A multi-dimensional empirical analysis was conducted in this paper. Findings The analysis of the pathways of action shows that narrowing the income gap is an important mechanism through which the digital economy actively contributes to the quality of life. The results of the threshold model show that the “marginal effect” of the digital economy on quality of life is non-linear and increasing. The results show that after a series of robustness tests, including instrumental variables, the digital economy still significantly enhances people’s quality of life. Research limitations/implications This paper reveals the intrinsic link between the digital economy and quality of life and provides a theoretical basis for further improving people’s well-being. Practical implications Encouraging the development of the digital economy is a useful way to improve the quality of life by narrowing the income gap. Originality/value Data analysis of the digital economy from 2011–2020 in China to get an insight into what would be the mechanism behind the digital economy improving the quality of life of our residents.