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The Impact of Digital Governance on Entrepreneurial Activity in Relatively Poor Areas: Evidence from Tibet, China

Author

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  • Aiyan Xu

    (School of Economics and Management, Tibet University, Lhasa 850011, China)

  • Pengji Li

    (School of Economics and Management, Tibet University, Lhasa 850011, China)

  • Xin Xin

    (School of Economics and Management, Tibet University, Lhasa 850011, China)

Abstract

This paper examines the impact of digital governance on entrepreneurial activity in relatively poor areas from both theoretical and empirical perspectives. Our study is twofold. First, we utilize a economic geography model to theoretically analyze the influence of digital governance on regional entrepreneurial endeavors and develop research hypotheses. Second, using county panel data from Tibet spanning from 2001 to 2021, we empirically examine the influence of digital governance on entrepreneurial activity. The results show that digital governance can significantly increase regional entrepreneurial activity, and that the effect exhibits an upward and then a downward trend over time, with some spatial spillover effects. We argue that differences in regional network infrastructure are an important heterogeneity factor affecting digital governance’s ability to increase entrepreneurial activity. Our conclusions remain robust to various tests.

Suggested Citation

  • Aiyan Xu & Pengji Li & Xin Xin, 2024. "The Impact of Digital Governance on Entrepreneurial Activity in Relatively Poor Areas: Evidence from Tibet, China," Sustainability, MDPI, vol. 16(17), pages 1-15, August.
    • Handle: RePEc:gam:jsusta:v:16:y:2024:i:17:p:7247-:d:1462216
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    References listed on IDEAS

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    1. Paul Krugman, 2009. "The Increasing Returns Revolution in Trade and Geography," American Economic Review, American Economic Association, vol. 99(3), pages 561-571, June.
    2. Junjie Li & Guohui Zhan & Xin Dai & Meng Qi & Bangfan Liu, 2022. "Innovation and Optimization Logic of Grassroots Digital Governance in China under Digital Empowerment and Digital Sustainability," Sustainability, MDPI, vol. 14(24), pages 1-28, December.
    3. Marianne Bertrand & Esther Duflo & Sendhil Mullainathan, 2004. "How Much Should We Trust Differences-In-Differences Estimates?," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 119(1), pages 249-275.
    4. Blanka, Christine & Krumay, Barbara & Rueckel, David, 2022. "The interplay of digital transformation and employee competency: A design science approach," Technological Forecasting and Social Change, Elsevier, vol. 178(C).
    Full references (including those not matched with items on IDEAS)

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