The digital economy has changed the way agricultural production is organized and how rural households access markets, jobs, and information. Yet it remains unclear whether these changes translate into higher income for rural residents, especially in major agricultural regions. This study examines the income effect of digital infrastructure development by using the rollout of the Broadband China policy as a quasi-natural experiment. The analysis draws on panel data for 77 prefecture-level administrative units in the Yellow River Basin, one of China’s major agricultural regions, from 2009 to 2021. A staggered difference in differences model is used to estimate the policy effect. The results show that digital infrastructure development significantly increases rural residents’ income. Under the log income specification, the baseline coefficient indicates an average income increase of about 8.33%. The mechanism analysis shows that innovation capacity and nonfarm employment both serve as positive partial transmission channels, with innovation capacity explaining a larger share of the total effect. The heterogeneity results suggest that the income effect is stronger in regions with higher GDP and larger population size. These findings indicate that digital infrastructure can support rural income growth when it is linked with local innovation capacity, employment opportunities outside agriculture, and rural development policies suited to local conditions.
Zhou et al. (Sun,) studied this question.