Does Digital Technology Development Promote Entrepreneurial Activity? Evidence from Spatial Spillover Effects in China

This study examines how digital technology development affects entrepreneurial activity from a spatial perspective. Existing studies have mainly emphasized the local entrepreneurial effects of digital technology, while paying relatively limited attention to whether such effects extend across cities through spatial linkages. Using manually compiled large-scale business registration data, this study constructs a balanced panel dataset covering 281 prefecture-level and above cities in China from 2006 to 2020. Spatial autocorrelation tests and spatial econometric models are applied to identify the local and spatial spillover effects of digital technology. The findings suggest that urban entrepreneurial activity exhibits significant spatial dependence. After controlling for spatial correlation, digital technology development significantly promotes local entrepreneurial activity and generates positive spillover effects on surrounding cities. Effect decomposition results show that the indirect effect of digital technology is stronger than its direct effect, suggesting that spatial spillover is an important channel through which digital technology affects entrepreneurial activity. Further analysis finds that this effect differs across technology types, city size, urban hierarchy, and geographical location. Distance-band tests indicate that the positive spillover effect weakens as geographical distance increases. Overall, digital technology can promote entrepreneurial activity through regional linkages, but its spatial influence depends on actual intercity connections.