Digital Governance and Urban Entrepreneurial Vitality:Evidence from the"National Pilot Policy of Information Benefiting the People"in China
As a catalyst for economic development and innovation,entrepreneurship is subject to a complex web of contextual factors.While extant research has extensively examined the impact of digital technology use,digital infrastructure,and digital finance on entrepreneurial endeavors in the digital era,a critical gap exists in understanding the distinctive role played by government-led digitization.Over the past decade,China has witnessed a rapid evolution in government digitization.The United Nations'E-Government Survey underscores this progress,revealing that China's E-Government Development Index has nearly doubled,surging from 0.47 in 2010 to an impressive 0.81 in 2022,accompanied by a remarkable leap of almost 30 positions in global rankings.This study investigates the impact of digital governance on regional entrepreneurial vitality by taking the"National Pilot Policy of Information Benefiting the People"implemented in 2014 as a natural experiment.The overarching objective of the policy is to elevate the government's digital governance capabilities.According to the implementation focus of the pilot project,the channels through which digital governance can affect entrepreneurship are summarized as follows.First,the policy strives to augment the administrative efficiency of the government and elevate the quality of public services,thereby reducing the institutional transaction costs in the process of entrepreneurship.Second,the initiative places a concerted emphasis on fostering government transparency and facilitating interaction between the government and the public,which alleviates entrepreneurs'concerns about uncertainty.Drawing on Chinese industrial and commercial enterprise registration data from 2010 to 2019 and using a difference-in-differences framework,the study finds that digital government construction has significantly promoted urban entrepreneurial vitality,which is robust to a number of robustness tests.We further explore two mechanisms through which digital governance may promote local entrepreneurship.First,digital governance reduces institutional transaction costs,supported by a stronger effect of digital governance in areas with higher institutional transaction costs and administrative fees.Second,digital governance can alleviate individual concerns about policy uncertainty,which is proven by the more pronounced impact in areas with political turnover and a reduced effect in areas with a higher level of institutional trust.Further analysis reveals that the positive effect of this pilot policy on entrepreneurship is stronger in regions with more abundant production factors,including talent and capital,and a better institutional environment.In addition,digital governance can effectively improve the quality of entrepreneurship.This study investigates the role of government in promoting entrepreneurship from the perspective of digital transformation,which provides important theoretical and empirical insights on how to improve governance and promote high-quality development in the new era.The contributions of this study are threefold.First,it extends the scope of entrepreneurship enabler research by adopting a novel perspective centered on digital governance.While extant entrepreneurial investigations predominantly focus on the influence of residents'digital technology usage,digital infrastructure development,digital financial evolution,or the overall development status of the regional digital economy on entrepreneurial activities,scant attention has been directed toward scrutinizing the distinctive role played by government-led digitization.Second,this study offers valuable insights into the economic implications of digital governance.Current studies on digital governance are mostly theoretical musings on its conceptual connotations and constructive implications.More recent studies have focused on the impact of digital governance on the innovation of listed companies.This study further reveals the important role of digital governance in stimulating regional economic vitality from the perspective of entrepreneurship.Third,through a meticulous examination of mechanisms and an exploration of regional synergies,this study provides empirical insights aimed at optimizing the policy mix effect to stimulate entrepreneurship.
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