Digital economy, technological progress, and city export trade

Abstract

The development of the digital economy is conducive to the innovative development of foreign trade and the formation of a “dual circulation” development pattern in China. Based on the panel data of 285 prefecture-level cities in China from 2005 to 2019, this paper examines the influence of the digital economy on urban export trade and its heterogeneity. And we use a mediating effect model to explore the possible mediating role of technological progress in the above influences. The results find that: (1) The improvement of the digital economy can promote cities export; (2) The promotion of the digital economy to the growth of city export scale is heterogeneous, which is more significant in the western and northeastern cities with relatively remote geographical locations, and the third-tier and lower cities with relatively backward economic development. (3) Technological progress has played a significant role in promoting the growth of export for the digital economy. Thus, it’s of great importance for China to increase investment in digital economy infrastructure and pay more attention to the differences in diverse city development processes. It should also support basic research and development in information technology to promote high-quality development of China’s foreign trade through the digital economy.