Does smart city pilot policy promote the enterprises’ digitalisation? Evidence from a quasi-natural experiment in China

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ABSTRACTWith the growth of the digital economy, the strategic significance of the smart city pilot policy to 'empower' the digitalisation of enterprises has become prominent. This study examines the impact and mechanism of the smart city pilot policy on the digitalisation of enterprises using the difference-in-differences (DID) method. Findings show that (1) the digitalisation level of the enterprises in a pilot city exceeds that of the enterprises in a non-pilot city, demonstrating that the policy can facilitate enterprise digitalisation improvement; (2) the smart city pilot policy encourages enterprise digitalisation in two ways: technological innovation and optimal resource allocation; and (3) the heterogeneity test reveals that the policy has a promotion effect on the digitalisation of enterprises that belong to an industry that is related to the smart city, state-owned enterprises, and those located in the eastern region. This study has significant policy ramifications that may help enterprises further develop their digitalisation.KEYWORDS: Smart city pilot policydigitalisationtechnological innovationresource allocation AcknowledgementsAll authors approved the version of the manuscript to be published.Disclosure statementNo potential conflict of interest was reported by the author(s).Additional informationFundingThis work was supported by the National Natural Science Found of China [grant number: 71972099]. This work was supported by the Research and Innovation Support Program for Doctoral Students of the Department of Business Administration in Nanjing University [grant number: ZFJH202203].Notes on contributorsRui DuRui Du, Her research focuses on the corporate governance, corporate social responsibility and digital transformation. Email: dg20020049@smail.nju.edu.cnHaijian LiuHaijian Liu Prof. Liu's research focuses on the corporate social responsibility and ethical social judgement, Chinese firms' internationalization strategy, entrepreneurship and innovation. Email: liuhj@nju.edu.cnJichen LiJichen Li, Her research focuses on the digital economy, enterprise digital transformation. Email: dg21020057@smail.nju.edu.cn