Abstract:    The transformation and upgrading of the manufacturing industry are inevitable requirements for China′s high-quality development. Based on the national tax sampling survey data from 2007 to 2015, and matched with the national innovation city pilot policy, we found that the national innovation city pilot policy significantly promoted the upgrading of the manufacturing industry in the pilot cities, and there were spatial spillover effects. After estimating PSM-DID, parallel trend test, placebo test, and excluding other policy influences, the conclusion remained robust. The pilot policy promotes manufacturing upgrading through output adjustment and industry entry and exit, enhances significantly the agglomeration level, R&D intensity, and capital deepening of high-tech manufacturing industries, and improves profoundly the labor, capital input, R&D expenditure, and performance of high-tech enterprises. The policy effect is positively regulated by the degree of marketization and government efficiency, and negatively regulated by the degree of market segmentation. This study has enriched the relevant literature on the driving factors of manufacturing upgrading and the economic effects of national innovative city pilot policies, which has important implications for optimizing urban innovation policies and promoting the transformation and upgrading of the manufacturing industry.

Key words: national innovation city pilot, manufacturing upgrading, high-tech enterprise