Can informatization improve urban entrepreneurial activity? Evidence from China

Abstract Informatization plays a leading role in promoting the deep integration of technology and industry and stimulating the vitality of new business creation. Based on city-level data from 2003 to 2022, this study investigates the effect of informatization on urban entrepreneurial activity and the mechanisms using the establishment of “pilot zones for informatization and industrialization integration” as a policy shock and employing a time-varying difference-in-differences (DID) method. The findings show that informatization significantly enhances urban entrepreneurial activity. Moreover, this effect is stronger in the smart manufacturing and service industries, as well as in cities with superior economic levels and higher administrative rankings. The mechanism test reveals that informatization mainly stimulates urban entrepreneurial activity by enhancing technical talents and technological foundations, expanding market demand, and improving the investment environment. This study not only enriches research on the correlation between informatization and entrepreneurship but also provides important theoretical basis and policy implications for fully leveraging the advantages of informatization construction and promoting urban entrepreneurship development.