Digital Governance and Urban Economic Resilience: A Quasi-Natural Experiment from China’s Information-Based Public Welfare Pilot

Amid mounting global economic volatility, systemic financial risks, and the accelerating pace of technological transformation, building robust and adaptive urban economies has become an urgent priority for policymakers worldwide. Urban economic resilience (UER) — the capacity of cities to absorb, recover from, and adapt to external shocks — has consequently become a cornerstone objective of sustainable urban development strategies, yet the role of digital governance in shaping this capacity remains insufficiently explored. This study investigates whether and how the development of digital government causally enhances UER in the context of urban China. We hypothesized that digital government development strengthens UER primarily by stimulating regional innovation and facilitating the structural upgrading of local industries. To test this, we exploit the National Pilot Program for Information-Based Public Welfare, launched in 2014, as a quasi-natural experiment, applying a multi-period difference-in-differences (DID) model to a balanced panel dataset covering 285 prefecture-level cities across China over the period 2010–2022. The results confirm our hypothesis: digital government development exerts a significant and positive effect on UER, with innovation capacity and industrial structure upgrading identified as the two principal transmission mechanisms. Heterogeneity analysis further reveals that this positive effect is considerably stronger in cities with low natural resource dependence, while it remains weak and statistically tenuous in resource-dependent cities. Additionally, we uncover a high investment-low efficiency trap in western regions, where digital infrastructure spending has not translated proportionally into resilience gains. Theoretically, this study enriches the literature on digital governance and urban resilience by providing robust causal evidence of their linkage. Practically, the findings offer a foundation for designing differentiated, region-specific digital governance policies aimed at fostering equitable and sustainable urban development across China.