Rethinking the Effects of Smart City Implementation on Industrial Structure Change

Understanding the relationship between smart city implementation (SCI) and industrial structure change is necessary for improving SCI and achieving high-quality development of the urban economy. This study aims to comprehensively investigate how the two core SCI investments—information and communication technology (ICT) infrastructure and human capital—influence industrial structure. To this end, both SCI investments are measured using composite indexes calculated by the vertical and horizontal scatter degree method, and spatial panel models are applied using data from 156 smart cities in China from 2013 to 2019, classified according to their economic development level and population density. The results show that industrial structure upgrading produces positive spatial spillover effects and that the impacts of SCI investments on industrial structure change vary in different city classifications. Overall, ICT infrastructure promotes the upgrading of industrial structure, while human capital hinders industrial development due to human capital mismatch. Mechanism analysis shows that SCI investments can influence industrial structure through technological innovation and consumption upgrading. Moreover, policy implications are proposed to promote industrial structure upgrading for effective future SCI.