Mechanisms of The Impact of Fintech Development On Residents' Income: A Causal Inference Model
DOI:
https://doi.org/10.56294/sctconf20251184Keywords:
FinTech , Socio-Economic Factors, Machine Learning, Fixed Effects, China Family Panel StudiesAbstract
This research examines how the development of financial technology (FinTech) is affecting families' income in China, a nation that has multiplied. To measure the detrimental impact of FinTech on families' earnings, investigators collected data from the Peking University Digital Financial Inclusion Index of China and the 2018 China Family Panel Surveys. To measure the detrimental effects of FinTech, the authors adopted the Fixed Effects (FE) double-fixed model. After correcting several socio-economic factors such as education, employment status, and knowledge of digital technologies, the findings from the survey indicated that FinTech has a positive effect value of 0.178 (p<0.01), signifying it improves the annual income of households. Dissecting the demography, the rural areas show a more substantial impact (β = 0.253, p < 0.01) compared to urban areas (β = 0.198, p < 0.01). Also, the high-income individuals benefit more from fintech advancements (β = 0.249, p < 0.01) than their low-income counterparts (β = 0.182, p < 0.01). The anlaysis was further confirmed for consistency using robustness analysis using different measures and modeling approaches.
References
1. Ediagbonya, V., & Tioluwani, C. (2023). The role of fintech in driving financial inclusion in developing and emerging markets: issues, challenges and prospects. Technological Sustainability, 2(1), 100-119.
2. Afjal, M. (2023). Bridging the financial divide: a bibliometric analysis on the role of digital financial services within FinTech in enhancing financial inclusion and economic development. Humanities and Social Sciences Communications, 10(1), 1-27.
3. Wang, S., Jiang, X., & Khaskheli, M. B. (2024). The Role of Technology in the Digital Economy’s Sustainable Development of Hainan Free Trade Port and Genetic Testing: Cloud Computing and Digital Law. Sustainability, 16(14), 6025.
4. Mpofu, F. Y. (2023). Fintech, the fourth industrial revolution technologies, digital financial services and the advancement of the SDGs in developing countries. International Journal of Social Science Research and Review, 6(1), 533-553.
5. Passanisi, F. (2024). FinTech as a transformative model for financial inclusion: a systematic review.
6. Molla, A., & Biru, A. (2023). The evolution of the Fintech entrepreneurial ecosystem in Africa: An exploratory study and model for future development. Technological Forecasting and Social Change, 186, 122123.
7. Zhang, C., Zhu, Y., & Zhang, L. (2024). Effect of digital inclusive finance on shared prosperity and the underlying mechanisms. International Review of Financial Analysis, 91, 102940.
8. Ediagbonya, V., & Tioluwani, C. (2023). The role of fintech in driving financial inclusion in developing and emerging markets: issues, challenges and prospects. Technological Sustainability, 2(1), 100-119.
9. Mustafa, J. A., Marei, A., Al-Amarneh, A., & Al-Abbadi, A. (2023). The role of Fintech payment instruments in improving financial inclusion. Information Sciences Letters, 12(6), 2659-2670.
10. Cai, Y., Huang, Z., & Zhang, X. (2024). FinTech adoption and rural economic development: Evidence from China. Pacific-Basin Finance Journal, 83, 102264.
11. Jejeniwa, T. O., Mhlongo, N. Z., & Jejeniwa, T. O. (2024). AI solutions for developmental economics: opportunities and challenges in financial inclusion and poverty alleviation. International Journal of Advanced Economics, 6(4), 108-123.
12. Ediagbonya, V., & Tioluwani, C. (2023). The role of fintech in driving financial inclusion in developing and emerging markets: issues, challenges and prospects. Technological Sustainability, 2(1), 100-119.
13. Yang, T., & Zhou, B. (2024). Local FinTech development, industrial structure, and north-south economic disparity in China. International Review of Financial Analysis, 93, 103119.
14. Li, Y., & Wen, X. (2023). Regional unevenness in the construction of digital villages: A case study of China. Plos one, 18(7), e0287672.
15. Ediagbonya, V., & Tioluwani, C. (2023). The role of fintech in driving financial inclusion in developing and emerging markets: issues, challenges and prospects. Technological Sustainability, 2(1), 100-119.
16. Xie, Yu, Zhang, Xiaobo, Tu, Ping, and Ren, Qiang. China Family Panel Studies (CFPS), 2018-01-25. https://doi.org/10.3886/ICPSR36524.v2
Downloads
Published
Issue
Section
License
Copyright (c) 2025 Luxuan Huang (Author)
This work is licensed under a Creative Commons Attribution 4.0 International License.
The article is distributed under the Creative Commons Attribution 4.0 License. Unless otherwise stated, associated published material is distributed under the same licence.
