Rising labour costs and the entrepreneurship of AI enterprises - evidence from China’s county-level minimum wage system

Strategic planning of artificial intelligence (AI) enterprise development is key to enhancing regional competitiveness. Amid rising labour costs, the impact of minimum wage policies on AI entrepreneurship reflects the balance between labour markets and industrial development, making it a vital policy issue. Using county-level data from China and a double machine learning (DML) model, this study finds that higher minimum wages significantly promote the entrepreneurship of tAI enterprise. This effect weakens with distance from urban centres and is positively moderated by human capital, consumer markets, and venture capital. Mechanism analysis confirms that wage hikes stimulate AI entrepreneurship by increasing non-AI firms' demand for digital technologies.