A Study on the Impact of Digital Financial Literacy on Household Entrepreneurship—Evidence from China

With the rapid development of digital finance, digital financial literacy is becoming increasingly important. This study examines the impact of digital financial literacy on household entrepreneurship and finds that it significantly promotes the occurrence of household entrepreneurship. To address potential endogeneity concerns, the study employs an instrumental variable approach, and the results remain robust after a series of checks. Heterogeneity tests reveal that the effect of digital financial literacy on household entrepreneurship is particularly pronounced in rural areas, underdeveloped regions, and lower-tier cities. Further analysis indicates that digital financial literacy also enhances household entrepreneurial investment levels, with a more significant impact on survival entrepreneurship investments. In mechanism tests, the study shows that access to formal finance partially mediates the relationship between digital financial literacy and household entrepreneurship. Additionally, our research also found that digital financial literacy can promote entrepreneurship among marginalized groups, such as women and individuals with lower levels of education. Our findings offer valuable insights for policymakers aiming to foster sustainable and inclusive development. In line with the United Nations’ 2030 Agenda for Sustainable Development, entrepreneurship is recognized as a key driver for achieving sustainable economic growth. Our study emphasizes the importance of promoting entrepreneurship by enhancing digital financial literacy among residents in underdeveloped areas, which is crucial for fostering inclusive growth, creating jobs, and reducing regional disparities, all of which contribute to long-term sustainable development.