Technological relatedness, technological complexity and the development of digital technology in Chinese cities

The digital economy has become a new growth engine for the global economy, prompting cities worldwide to vigorously drive the development of digital technologies. This article draws on the relatedness-complexity framework in evolutionary economic geography to examine the development of digital technology in Chinese cities. Using a database of approximately 5 million digital technology patents from 297 prefecture-level cities in China between 1991 and 2020, we find that digital technology has developed rapidly across Chinese cities, but is mainly concentrated in the eastern cities. Second, our econometric model shows that relatedness is positively associated with the development of digital technologies in cities, while complexity has a negative effect. Moreover, by breaking down relatedness into digital and non-digital relatedness, we find that both play a significant role in digital technology development in cities. Additionally, cities are more likely to develop new digital technologies with high technological complexity when relatedness is high, particularly when digital relatedness is strong. Third, based on the current status of each city and the underlying mechanisms, we identify future opportunities for the development of new digital technologies in cities.