Interrelationship between population aging, digital economy, and industrial structure of economy: evidence from China

The accelerating trend of population aging presents both challenges and opportunities for the new quality of China’s economic development. Based on the key demographic characteristics of the People's Republic of China, this study utilizes provincial panel data spanning from 2011 to 2023. Aim. To analyze the traditional channels through which population aging affects the upgrading of industrial structure, and on this basis, to investigate the mechanisms through which factors such as consumption structure, human capital, technological innovation, labor productivity, social security expenditure, and digital economy exert their influence. Methods. Quantitative analysis and empirical analysis. Results. Empirical findings reveal that population aging has a "first‐promoting‐then‐restraining" effect on the upgrading of China's industrial structure through traditional pathways such as consumption structure and technological innovation. At the same time, population aging positively influences industrial upgrading through channels like human capital, labor productivity, and social spending. The study also demonstrates that, on the one hand, population aging stimulates the development of the digital economy and reshapes the industrial structure; on the other hand, the digital economy significantly mitigates the adverse effects of population aging. Heterogeneity analysis confirms regional disparities in the impact of aging on industrial upgrading across Chinese provinces: the effect is positive in the eastern and northeastern regions, with a more pronounced impact in Northeast China compared to the East. The empirical evidence suggests that, by acknowledging demographic aging trends and promoting the development of the digital economy, China aims to achieve a new quality of economic growth and development.