Exploring the (dis)advantages of smart cities’ inclusive, integrative and social practices in new business creation: the effect of human capital inflow

Abstract

ABSTRACT The term ‘smart’ has become key in cities’ development policies. The need to adapt to an increasingly global and dynamic context is fundamental to cities’ survival and development trajectories. Nonetheless, how this goal should be met and how the ‘smart’ dimension in cities impacts the social, economic and urban levels are still subject to debate. In the present paper, we focus on the relationship between the ‘smart living’ dimension, which includes integrative, inclusive and social practices, and the promotion of a local entrepreneurial environment by considering the moderating role of intra- and international human capital inflow. Using a GLS method and a panel dataset that includes 30 cities, we demonstrate that the relationship tends to be an inverted U-shaped curve, contributing to the discussion on the impact of smart cities’ social policies on entrepreneurship in urban contexts. Furthermore, we highlight that human capital inflow positively moderates this relationship, showing that intra- and international human capital flows contribute differently in this regard, producing divergent effects. We conclude with implications for academics and policymakers, and practical and theoretical suggestions.