The Impact of Digital Economy Development on the Efficiency of Fiscal Expenditure — Based on Human Capital and Government Governance Capacity

Based on the dual perspectives of human capital and government governance capacity, this paper adopts panel data of 285 prefecture-level cities in China from 2010 to 2023. It constructs a comprehensive evaluation index system to measure the development level of the digital economy and empirically examines its influencing mechanism on fiscal expenditure efficiency. The results show that digital economy development significantly improves fiscal expenditure efficiency with prominent regional heterogeneity. For central and western regions, the empowering effect of the digital economy is mainly released by improving government governance, while eastern regions enhance efficiency through optimizing human capital allocation, both of which present significant positive moderating effects. Accordingly, this paper proposes implementing regionally differentiated strategies, improving digital governance and talent supply tailored to local conditions, and accelerating the construction of digital infrastructure and digital government to sustainably promote fiscal expenditure efficiency and empower high-quality economic development.