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Impact of Digital Technology Innovation on China's Industrial Gradient Patterns: Spatial Differentiation and Dynamic Comparison

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  • Xu Shao
  • Xuzhao Li
  • Rizwan Rasheed

Abstract

This study examines the new characteristics and multidimensional impacts of digital technology innovation on the regional industrial gradient shift in China. Through empirical analysis of a dataset at the prefectural level from 2008 to 2020, the research reveals that digital technology innovation has driven the outward relocation of midstream industries and the concentration of downstream industries in digital technology innovation hubs, with this effect strengthening over the sample period. Heterogeneity analysis further indicates that digital technology innovation not only facilitates the traditional coastal‐to‐inland gradient transfer but also introduces new pathways, such as hierarchical diffusion centred around urban clusters and network diffusion at transport hubs. Mechanism testing shows that digital technology innovation enhances innovation spillover effects and labour‐saving production process improvements, thereby providing impetus for industrial migration. This study expands the applicability of the traditional ‘flying geese’ theory and offers policy insights for developing countries in managing industrial layout under large‐scale economies.

Suggested Citation

  • Xu Shao & Xuzhao Li & Rizwan Rasheed, 2026. "Impact of Digital Technology Innovation on China's Industrial Gradient Patterns: Spatial Differentiation and Dynamic Comparison," The World Economy, Wiley Blackwell, vol. 49(5), pages 1038-1053, May.
    • Handle: RePEc:bla:worlde:v:49:y:2026:i:5:p:1038-1053
    DOI: 10.1111/twec.70063
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