Abstract: Based on the panel data of 16 prefecture-level cities in Anhui Province from 2011 to 2020, this paper uses the entropy method to measure the actual development level of their digital economy, and selects Theil index as an indicator to measure the urban-rural income gap. The fixed effect model and threshold effect model are used to study the impact of digital economy on the urban-rural income gap. The results show that: (1) The influence of the development level of digital economy on the urban-rural income gap in Anhui province is a "U-shaped" relationship, which decreases first and then expands, and can pass the robustness test. (2) The income gap between urban and rural areas is affected by the level of economic development, and does not show a simple linear relationship with the digital economy. When the level of economic development is low, the digital economy has a significant role in expanding the urban-rural income gap, and when the economic development reaches a certain level, the digital economy will narrow the urban-rural income gap to a certain extent. (3) Government support, urbanization level, transportation infrastructure and other factors are conducive to narrowing the urban-rural income gap.

Key words: urban-rural income gap; Digital economy; Bidirectional fixed model; Threshold effect