Smart city policy and export technology sophistication: Investigating linkages and potential pathways

Abstract

China has been actively promoting the development of smart cities as part of its national agenda, which is seen as a way to enhance urban management and high-quality development. This paper intends to empirically investigate the impact of smart city policy on export technology sophistication, based on the prefectural-level dataset in China's 285 cities during the period 2005–2018. We also conduct a series of robustness tests including the parallel trend test and the placebo test. We then also investigate their heterogeneous nexus, and the potential impact mechanisms. The main findings are as follows. First, baseline results reveal the positive relationship between smart city policy and export technology sophistication, which highlights that smart city policy plays a significant role in accelerating export technology sophistication in China's cities. Second, we analyze their heterogeneity from the perspectives of the characteristics and endowments of the sample cities. Smart city policy shows a more effective promoting effect on export technology sophistication in the capital cities, large-and-medium cities, as well as resource-based cities. Third, the mechanism discussions indicate that environmental regulation and technological progress are two significant mediators, which means that smart city policy affects export technology sophistication by stimulating environmental regulation and technological progress. Our findings are of both theoretical and practical significance for realizing export upgrading.