Regional institutional fragmentation and local protectionism hinder cross-regional collaborative innovation. This study examines how government digital transformation facilitates cross-regional collaborative innovation by improving governance capacity. Combining patent text data with government procurement contracts, we find that government digital transformation significantly promotes firms’ cross-regional collaborative innovation on average, while the relationship is non-linear with a threshold: very low levels may temporarily disrupt collaboration, but effects become increasingly positive beyond a critical level. Mechanism tests indicate that digital transformation improves the innovation environment by strengthening institutional safeguards and reducing transaction costs and uncertainty, and it enhances the supply of innovation factors by promoting cross-regional capital and labor mobility. The effects are stronger for growth-stage firms and non-technology-intensive firms, and in cities with stronger intellectual property protection. These findings highlight government digital transformation as an important governance mechanism for reducing regional institutional barriers and fostering cross-regional innovation networks.
Du et al. (Wed,) studied this question.