Impact of the Digital Economy and Financial Development on Residents’ Consumption Upgrading: Evidence from Mainland China

Consumption upgrading reflects people’s pursuit of a better life and is an important engine of high-quality economic development. Based on the panel data of 30 provinces in China from 2006 to 2021, this study analyses the impact and mechanism of the digital economy and financial development on residents’ consumption upgrading from a macro perspective. The findings demonstrate that the digital economy, financial development, and their synergistic effect significantly promote residents’ consumption upgrading, which improves the overall level of residents’ consumption expenditure and promotes the transformation of the residents’ consumption structure from subsistence to development and enjoyment expenditure. The common mechanism of the digital economy and financial development is industrial structure optimization. The positive effects of the digital economy, financial development, and their synergy on residents’ consumption upgrading have obvious regional and urban–rural heterogeneity and show nonlinear characteristics with the advancement of new urbanization.