Abstract:  The main approaches of the supply-side structural reform are to invigorate the digital economy and to realize the integrated development of the digital economy and the real economy. Taking advantage of digital technology, the real economy boosts yields, promotes efficiency, and expands the connotation of the digital economy. However, the digital economy energizing effect presents a typical "reverse integration" path. Judging from the actual operation and grass-root feedback, the tertiary industry such as finance, transportation, accommodation, and catering makes changes first. The transformation of the real economy is still in the "transition stage", deserving long-term observation. Besides, the integration of the digital economy and the exertion of the transformation effect need to be supported by preconditions, which are closely related to the level of industrialization and the stage of economic development. Due to China′s industrialization has not been completed yet, the digital economy is confronted with the dual tasks and severe challenges that require the digital economy to catch up with the industrialization process and synchronize the digital opportunities. As a result, an increasingly serious digital divide has emerged: many real economy enterprises are seldomly aware that the data resources generated within the business operation life cycle can promote the production and operation efficiency, and reduce manufacturing costs.
In fact, without the participation of the real economy, the digital economy is a brittle bubble. To this end, at the special digital economy meeting of the G20 Osaka Summit in 2019, General Secretary Xi Jinping, the Central Committee of the Communist Party of China, accentuated that "we are ought to promote the inclusiveness of digital economy, advance integrated development, and strengthen the construction of digital infrastructure to facilitate interconnectivity". To implement the instructions of General Secretary Xi thoroughly and realize the strategic goals of integrated development, it is essential to systematically evaluate the interrelationship between the digital economy and the real economy as well as their mechanism. So, has China′s digital economy effectively supported the development of China′s real economy? Will the rapid iteration of the digital economy influence the development of the real economy? Can China′s development level of the real economy constrain the transformation effects of the digital economy? With this background and scientific issues, based on the cross-section data of 290 cities in China, this article utilized the weighted least squares, quantile regression, and cross-section threshold regression to demonstrate the overall effect, conditionality, and stage characteristics of the digital economy′s impact on the digital economy.
It is found that, at the overall level, the digital economy has a significantly negative impact on the real economy, producing a certain degree of "crowding out effect". In terms of conditionality, under different conditions of the real economy, the "crowding out effect" is constant, but its degree will diminish marginally. In terms of stage characteristics, the impact of the digital economy presents an inverted "U" shape. Before crossing the critical value, it is expressed as a "promotion effect", however, after crossing the critical value, it is shown as a "crowding out effect". Only in the latter condition will the digital economy restrict the development of the real economy. Combined with the analysis results from the overall level, it is found that the current development level of the digital economy in China has crossed the "critical value", and there is a disconnection between the digital economy and the real economy. The auxiliary spatial difference analysis shows that the impact of the digital economy on the real economy in the eastern regions is manifested as "crowding out effect", but that impact in the central and western regions is shown as "promotion effect".
Based on the empirical conclusions, this article puts forward the following recommendations. First, accelerate the implementation of the "Internet plus initiative" strategy and reform the growth model of the real economy. The digital economy has a considerable promotion effect on the real economy before crossing the critical value. Therefore, the real economy must accelerate the implementation of the "Internet plus initiative" strategy, which will promote collective reform in the fields of manufacturing, marketing services, and financing, give full play to the role of the digital economy in reshaping and transforming the real economy, and empower the new development of the real economy continuously. Second, strengthen the endogenous development capability of the real economy to cope with the impact of the digital economy. In the coordinated development with the digital economy, we need to proactively adapt to the megatrends of the digital economy, and gradually enhance our ability to adapt, integrate and coexist with it. Third, deepen the supply-side structural reforms to expedite the development of the real economy. Giving full play to the role of fiscal and financial policies in guiding and safeguarding the real economy. Meanwhile, by overall planning and rational distribution to establish regional cooperation mechanisms, the real economy will be enhanced.
In general, this paper creatively links the digital economy with the real economy and demonstrates the characteristics and impact of the digital economy on the real economy from multiple dimensions. Based on the empirical evidence of 290 cities in China, this paper re-examines the relationship between the digital economy and the real economy and reviews its influence mechanism from the perspective of quantitative and empirical analysis, drawing many beneficent conclusions. On the one hand, it can provide direct evidence for the opinions involved in the qualitative research in the academic circle. On the other hand, it can also effectively speak for the controversial opinions. From this point of view, this paper is a powerful supplement to the existing results, which is also a major feature of this paper compared with the existing results. At the same time, in the aspect of the empirical analysis method, the weighted least square method, quantile regression method and cross-section threshold model used in this paper have a great effect on enhancing the credibility of research conclusions. In particular, the cross-section threshold model is a frontier approach in cross-section data analysis, which is also conducive to forming a new view and new cognition of the impact of the digital economy on the real economy. Through the application of multiple methods, this paper demonstrates that the points of view examined in this paper are progressive. This is also the characteristic of this study in terms of methods. However, due to the data acquisition, the sample size needs to be further expanded, and the related panel data model cannot be introduced. These problems are also the focus and direction of the breakthrough in the new era.

Key words: digital economy, real economy, effect, section threshold model