Science Research Management

Science Research Management ›› 2021, Vol. 42 ›› Issue (4): 35-45.

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Digital economy, innovation environment and urban innovation capabilities

Han Lu1, Chen Song1, Liang Lingling2   

  1. 1. School of Economics and Management, Tongji University, Shanghai 200092, China; 
    2. School of Economics and Management, Shanghai Institute of Technology, Shanghai 201418, China
  • Received:2020-12-15 Revised:2021-03-27 Online:2021-04-20 Published:2021-04-19

Abstract: The implementation of national innovation strategy is based on the improvement of urban innovation capability. The rise of digital economy has brought new opportunities for improving urban innovation capability. However, the existing research on digital technology mainly focuses on the enterprise-level from micro perspectives. Few studies have researched the relationship between digital economy and urban innovation capability from the macro perspective yet. And researchers have not explored the influence of innovation environment (such as talent aggregation and financial development) on the relationship. What′s more, the research methods only stuck on explanatory theory analysis, and the research conclusions lack the support of empirical analysis. Therefore, the purpose of this paper is to investigate the relationship between digital economy and urban innovation capability from the perspective of urban level, and the moderating effect of talent aggregation and financial development as well.This paper used panel data of prefecture level cities in China from 2011-2016. Fixed effect model and quantile regression model were used to test the hypothesis. The results show that the digital economy can significant urban innovation capability, which is moderated by talent agglomeration and financial development. Specifically, in cities with high level of talent aggregation or financial development, the empowering effect of digital economy on urban innovation capability is stronger. The relationship between digital economy and urban innovation capability is positively moderated by talent aggregation and finical development. Further heterogeneity investigation shows that the contribution of digital economy to urban innovation is more obvious in cities with high innovation level, and the digital economy may expand the gap of innovation capability between cities. In order to resolve the problem of endogeneity caused by sampling selection bias, simultaneous causality, and omitted variable, three methods were adopted to examine the robustness， including the method for eliminating special sample, the instrument tool method of historical data and the method for replacing development variable, and the robust test showed that the results are positive.The contributions of this paper cover the following areas. First, it reveals the significant positive effect of digital economy on urban innovation capability, and the application of digital technology will expand the gap of innovation capability between cities, providing empirically evidences of the digital economy empowering urban innovation capability at the city level. Second, this paper enriches the research contents of relationship between digital innovation and urban innovation. We examined the moderation function of talent aggregation or financial development on the relationship between digital economy and urban innovation capability. The research shows that talent aggregation and financial development have a catalytic effect on the relationship. Finally, the conclusions provide some enlightenments for policy makers to take advantage of digital economy, such as paying attention to the fact that the digital economy may lead to the bigger gap of innovation capability between cities, and increasing investment to digital infrastructure and R&D activities. It is suggested that local government should take talent aggregation and financial development as important starting points to accelerate digital technology-enabled innovation.

Key words: digital economy, urban innovation capability, innovation environment, talent aggregation, financial development