Chance or challenge? Understanding how the Internet affects the nexus between tourism and urban-rural income inequality

Abstract

The nexus between tourism and income inequality has received much attention but no consensus emerged. It is of interest to explore how this nexus is affected by the important external condition of the Internet. This study examines the spatial threshold effect of the Internet on the nexus between tourism and urban-rural income inequality by developing a spatial threshold model. Using panel data for 280 Chinese cities from 2003 to 2019, the results show that the impact of the Internet is characterised by clear spatial thresholds, and the local and spatial spillover effects of tourism on urban-rural income inequality vary under different regimes of Internet development. Further, by differentiating the Internet’s functions, the inequality-reducing effect of tourism in local and surrounding cities has strengthened significantly as cities’ Internet penetration improves; meanwhile, this effect has increased first and then decreased as cities’ online market penetration deepens, with a relative optimal interval.