Agglomeration of Specialized, Refined, Distinctive, and Innovative (SRDI) Enterprises and Disparities in Urban Sustainable Development: Evidence from China

Abstract

The spatial agglomeration of specialized, refined, distinctive, and innovative (SRDI) enterprises has become an important feature of China’s innovation-driven development strategy. However, whether such agglomeration is associated with narrower or wider disparities in urban sustainable development remains unclear. Using an unbalanced panel of 296 Chinese prefecture-level cities from 2013 to 2024, this study constructs a city-level measure of SRDI enterprise agglomeration and examines its association with disparities in urban sustainable development. A two-way fixed-effects model is employed, supplemented by potential channel and heterogeneity analyses. The results show that SRDI enterprise agglomeration is significantly associated with greater city-level relative disparities in urban sustainable development. Further analysis suggests that nonagricultural industry development and innovation output may represent potential transmission channels underlying this positive association. Heterogeneity analysis reveals that this positive association is stronger in cities southeast of the Hu Huanyong Line, varies with proximity to innovation cores, and differs across population-density groups. These findings indicate that the spatial concentration of innovative enterprises may be associated with local development gains as well as more uneven development patterns across cities. The results highlight the importance of improving the capacity of less-advantaged cities to absorb and transform the benefits associated with SRDI enterprise agglomeration in order to achieve more balanced and sustainable urban development.