Diminishing　government　subsidies　for　distributed　photovoltaic　(DPV)　systems　have　aroused　wide　public　concern.　This　paper　intends　to　explore　the　influence　mechanism　of　economic　development　and　DPV　subsidy　strategy　and　provide　a　reference　for　promoting　DPV　development.　Evolutionary　game　theory　and　empirical　analysis　are　used　to　analyze　the　interactions　between　government　and　users　in　the　process　of　DPV　installation　in　China.　The　results　from　simulation　analysis　and　empirical　analysis　show　that　the　effect　of　DPV　subsides　is　restricted　by　regional　economic　development.　Based　on　local　economic　development,　the　government　can　choose　high　subsidy　strategy　or　low　subsidy　strategy　to　guide　the　DPV　development　in　a　reasonable　way.　Additionally,　the　decreasing　cost　can　effectively　boost　the　demand　for　DPV　investment　with　less　subsidies,　which　accounts　for　why　the　government　has　reduced　DPV　subsidies.　However,　subsidy　strategy　will　remain　an　important　tool　that　coordinates　local　economies　with　DPV　construction　until　the　electricity　generated　by　DPV　systems　can　achieve　grid　connection　at　a　comparable　price.　Moreover,　technological　innovation　should　be　encouraged　to　reduce　installation　cost　so　that　DPV　systems　can　be　accessed　at　affordable　prices　as　soon　as　possible.　©　2021　Elsevier　B.V.