Research on the Impact of Digital Village Strategy Implementation on Farmers’ Income Increase: Based on PSM-DID Test

The construction of digital villages is an important path to promote rural revitalization and achieve common prosperity, and it is crucial to assess the effect of digital village implementation. Based on the panel data of 685 counties in 20 provinces and regions of China from 2016 to 2022, the impact of the implementation of the digital village strategy on the farmers’ income is estimated by using the double-difference method (DID) and the propensity-matching-double-difference method (PSM-DID), and a regional heterogeneity test. The following main conclusions are drawn: first, both DID and PSM-DID methods estimate that the implementation of digital village strategy policy can promote rural residents’ income increase, and this conclusion also passes the parallel trend test and placebo test; Secondly, after the regional heterogeneity test of the effect of digital village construction on farmers’ income increase, the digital village pilot in the eastern region has the best effect on the increase of farmers’ income, followed by the western and central regions. Finally, recommendations are made in terms of rural digital infrastructure construction, digital transformation of the agricultural industry and the implementation of a digital rural differentiation strategy to provide policy insights for raising farmers’ incomes and promoting urban-rural parity.