Multiple Effects of Urban Innovation Activities on Growth of Key Industries: Case Study in Hangzhou, China

Abstract Promoting the development of innovation activities has become one important strategy for major countries and municipalities globally to promote economic growth. How can innovation-based economic activities promote the formation and development of industries? Potential answers to this question are quite significant for economic development both at the city and at the metropolitan levels. China’s Hangzhou was selected as a case study to investigate the driving effects of urban innovation activities on the growth of key industries. Based on the patent data and the output value of related industries from 2008 to 2017, this research first analyzed the spatial pattern of innovation activities and then examined the correlation and causality between innovation activities and industrial growth. The results show that in innovation-based development, the local innovation activities that can be effectively intervened are generally related to the growth of their key industries, but not all of them are causal. The innovation activities related to the high-end equipment manufacturing industry have a causal relationship with their industrial developments in Hangzhou. The development of such innovation activities to a large extent shows the trend of polycentric development and noncontinuous block agglomeration. This trend is also represented as a different development process and characteristics within different regions and directions in this city. Suggestions are provided to promote the development of relevant innovation activities, which could provide spatial strategies for the effective realization of innovation-driven development in Chinese cities and beyond.