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Judicial independence and regional digital innovation in China

Author

Listed:
  • Dongfa Feng
  • Yunqing Tao
  • Cai Wang
  • Rui Zhao

Abstract

Digital innovation is widely recognized as a critical pathway for nations to enhance competitiveness in the digital age. However, there is relatively limited literature exploring the link between judicial independence and digital innovation. We examine the causal relationship between judicial independence and regional digital innovation in China using a balanced panel dataset of 288 cities from 2011 to 2023. By treating the establishment of circuit courts as a quasi-exogenous shock to judicial independence, we employ a staggered difference-in-differences model to show that judicial independence significantly enhances regional digital innovation. Our mechanism analysis reveals that judicial independence promotes digital innovation through improved intellectual property protection and heightened enthusiasm for digital innovation. Heterogeneity analysis further demonstrates that the innovation-promoting effect of judicial independence is more pronounced in regions with weaker intellectual property protection strength, stronger government power, lower government fiscal surplus, and richer digital resources. Overall, we provide new evidence of the innovation-promoting effects of judicial independence and offers valuable insights for fostering regional digital innovation.

Suggested Citation

  • Dongfa Feng & Yunqing Tao & Cai Wang & Rui Zhao, 2026. "Judicial independence and regional digital innovation in China," Applied Economics, Taylor & Francis Journals, vol. 58(5), pages 874-888, January.
    • Handle: RePEc:taf:applec:v:58:y:2026:i:5:p:874-888
    DOI: 10.1080/00036846.2025.2459962
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