How Entrepreneurship Incentive Policies Affect Urban Innovation? A Study Based on National Entrepreneurial City Policy

Innovation is the only way to promote sustainable economic growth, and it is also an important way to solve China's regional development and transform the existing urban economic development model.This paper takes the construction of national entrepreneurial cities as a "quasi natural experiment" to study how the pilot policies aimed at encouraging entrepreneurship affect the level of urban innovation.The research finds that the construction of national entrepreneurial cities has significantly improved the level of urban innovation, which is robust.The mechanism shows that the construction of national entrepreneurial cities has effectively reduced the institutional transaction cost, increased the financial expenditure on science and technology, and improved the entrepreneurial activity, thus promoting the innovation level of pilot cities.