Research on the Impact of Digital Finance on Urban Innovation

Abstract

Innovation is the primary driving force for development and the strategic support for building
a modern economic system. As an important part of implementing the innovation-driven
development strategy, urban innovation is an important starting point to promote regional
innovation and build an innovative country. Digital finance, as a new business form produced
by the combination of digital technology and traditional finance, has a significant impact on
urban innovation. Taking prefecture-level cities as the research object, this paper uses panel
data model to explore the effect and mechanism of digital finance on urban innovation. The
results show that: digital finance has a significant promoting effect on urban innovation, and
the impact on urban innovation in different regions and different scales is obviously different;
The intermediary effect analysis shows that digital finance can promote urban innovation by
optimizing the supply of enterprise credit funds, expanding the scale of household consumption
and improving the level of human capital. The threshold effect analysis shows that digital
finance has a threshold effect on urban innovation due to its own development level, industrial
structure and institutional quality. The regulatory effect analysis shows that financial regulation
will weaken the promotion effect of digital finance on urban innovation to some extent. The
conclusions of this study can provide reliable empirical evidence for better play the role of
digital finance in promoting urban innovation capacity, and provide policy suggestions for
further implementing the innovation-driven development strategy and promoting high-quality
economic development.