How Does Digital Infrastructure Development Affect Housing Prices? A Quasi-Natural Experiment Based on the “Broadband China” Program

Currently, digital infrastructure development, as a key driver of economic growth in the new era, provides a new perspective for alleviating the current tremendous downward pressure on China's real estate market. Based on data from 255 prefecture-level cities in China from 2005 to 2020, this study takes the "Broadband China" Program as a quasi-natural experiment and uses the time-varying difference-in-differences (DID) model to investigate mechanisms of impact of digital infrastructure development on housing prices. The empirical results show that the "Broadband China" Program has a significant positive impact on housing prices, with an average treatment effect of 8%. This primarily occurs through population agglomeration, income enhancement, and technological innovation. It has also a positive spatial spillover effect on housing prices. Overall, digital infrastructure development is a "double-edged sword": while improving the quality of life and convenience, it will also bring about rising housing prices. Therefore, we should pay more attention to how to guide digital infrastructure development, including broadband networks, to reasonably regulate housing prices to promote the healthy development of China's real estate market.