Impact of artificial intelligence on entrepreneurial activity -empirical evidence from Chinese cities

Abstract

ABSTRACT This paper presents an investigation of the impact of artificial intelligence (AI) on entrepreneurial activity (EA) using panel data from 284 Chinese cities over the period 2010–2019. The study finds that AI has a positive and significant effect on EA, and this result remains robust after conducting a series of tests, including the endogeneity test, the exogenous shock test, and the robustness test. The study also conducts mechanistic and heterogeneity tests, which show that AI promotes technological innovation and drives consumer demand, leading to a positive effect on EA. Moreover, the entrepreneurial effect of AI is more significant in the eastern region, in regions with net population inflows, and in the service sector. These findings provide insights into the entrepreneurial impact of AI, and suggest the need to strengthen the top-level design and application of AI in the entrepreneurial system.