Regional entrepreneurial spirit and global value chains participation in Chinese cities: the moderating role of digital transformation signals

Abstract

Previous studies have focused on the impact of factor endowments, market size, geography, institutional quality, and new technologies on participation in the Global Value Chains (GVCs). However, the role of regional entrepreneurial spirit, which reflects local agency in arbitrage and innovation, has been largely ignored in shaping value-related economic activities. At the same time, new digital technologies provide the “opportunity window” for both firms and regions in the era of the digital economy. The issue of how regional entrepreneurial spirit exerts influence on global economic participation under the context of digitalization is worthy of further investigation. Thus, this study attempts to investigate the impacts of regional entrepreneurial spirit on local GVCs participation in China as well as the moderating role of digital transformation signals. With a big dataset matching from diversified sources, we find that regional entrepreneurial spirit has a significantly positive influence on local GVCs participation, which is moderated by the digital transformation signals from leading firms and local governments. In the early stages, the positive moderating effect from local governments is more stable and reliable, while leading firms' signals become more crucial in the latter stages. Furthermore, this moderating effect is more pronounced in cities with higher level of inclusiveness.