The impact of population shrinkage on enterprises’technological innovation

[Objective] Improving the level of technological innovation in enterprises is the key to developing new quality productivity. The current phenomenon of population shrinkage in China’s cities is becoming more pronounced. This study aimed to explore from the perspective of enterprises how these spatial phenomena affect corporate technological innovation and to conduct an in-depth analysis of the mechanisms involved, thereby proposing policy recommendations for the spatial optimization of corporate technological innovation and the promotion of high-quality development. [Methods] Based on the data of China’s A-share listed companies in Shanghai and Shenzhen from 2009 to 2018, this study used the population data from the China Urban Construction Statistical Yearbook to construct the urban population shrinkage index and matched it with the cities where the listed companies operate. The impact of urban population shrinkage on corporate technological innovation was empirically tested using fixed effects models and difference-in-differences (DID) models. This research also delved into the mechanisms behind these impacts through theoretical analysis. [Results] The study found that: (1) Population shrinkage had a certain negative effect on both the input and output of corporate technological innovation; (2) Population shrinkage negatively affected corporate technological innovation through mechanisms such as the weakening of human capital, reduction in industrial agglomeration, and the crowding-out effect of financial investment; (3) The impact of population shrinkage on corporate technological innovation exhibited heterogeneity across industries, particularly affecting the technological innovation behavior of technology-intensive enterprises, while having no significant impact on labor-intensive and capital-intensive enterprises. [Conclusion] To enhance the input and output of corporate technological innovation, further promotion of balanced spatial population development and regional innovation cooperation is required, which advances regional integration.