Regional Chambers of Commerce and Urban Entrepreneurial Activity

Entrepreneurial activity across different cities in China exhibits significant regional disparities,with a distinct pattern of being “strong in the east and weak in the west.” Social organizations play a critical role in China’s socialist modernization efforts.As an important form of social organization,chambers of commerce serve as key bridges linking the government,enterprises,and markets.Chambers of commerce refer to legally registered social organizations composed of members engaged in similar economic activities,individuals,or economic entities within the same region,operating under principles of industry service and self-regulation. In recent years,regional chambers of commerce in China have experienced rapid growth,playing an increasingly prominent role in supporting high-quality development.According to data from the China Social Organization Government Service Platform,as of December 2023,there were 24,970 registered regional chambers of commerce below the provincial level (excluding provincial-level chambers of commerce).However,the regional pattern of “strong in the east and weak in the west” remains prominent.This raises several critical questions:Can regional chambers of commerce enhance urban entrepreneurial activity? If a positive effect exists,what mechanisms drive it? What factors may strengthen or constrain the entrepreneurial impact of these chambers of commerce? Analyzing these questions not only contributes to understanding the theoretical and practical significance of regional chambers of commerce but also provides policy insights for optimizing the entrepreneurial environment and promoting employment. Based on data manually compiled from the China Social Organization Government Service Platform on regional chambers of commerce below the provincial level,matched with the 2003-2021 China Industrial and Commercial Registration Database,this study empirically examines the impact of regional chambers of commerce on urban entrepreneurial activity.The findings reveal that regional chambers of commerce significantly enhance entrepreneurial activity in cities.Specifically,an increase of one standard deviation in the cumulative number of regional chambers of commerce per 100,000 people results in an increase of 0.419 newly registered enterprises per 100 people in a city. The study conducted a series of robustness checks,including differentiating among types of chambers of commerce,replacing measures of urban entrepreneurial activity,modifying indicators of regional chambers of commerce development,and adjusting the research sample scope.All results consistently support the robustness of the main conclusions.To address potential endogeneity concerns,the study employs the number of chambers of commerce and river density in each prefecture-level city as of 1912 as instrumental variables for regional chambers of commerce. Mechanism analysis indicates that regional chambers of commerce enhance urban entrepreneurial activity by improving social trust and optimizing the business environment.Further,the study examines the heterogeneous impacts of regional chambers of commerce from multiple dimensions,including ownership types,industry classifications,and city types.The results demonstrate that regional chambers of commerce primarily promote the entry of individual industrial and commercial households and private enterprises,have the most significant impact on labor-intensive industries,and exhibit stronger entrepreneurial effects in third-tier and smaller cities,non-urban agglomeration cities,and small to medium-sized cities.Additionally,the study finds that regional chambers of commerce generate synergistic effects with entrepreneurship-related policies,thereby boosting urban entrepreneurial activity and enhancing urban innovation levels. Compared to existing research,this study offers three main contributions: (1) Existing empirical studies on chambers of commerce primarily focus on provincial-level nonlocal chambers of commerce in China,with limited discussion on local chambers of commerce and inadequate systematic analysis of regional chambers of commerce below the provincial level due to data constraints.This study is the first to extend the research perspective to regional chambers of commerce below the provincial level nationwide,encompassing both local and nonlocal chambers of commerce.It refines the spatial scale to include municipal-level,county-level,township-level,and neighborhood associations. (2) Previous literature has explored the impact of provincial-level nonlocal chambers of commerce on interregional enterprise development,cross-regional trade,and interprovincial labor mobility.This study enriches the empirical literature on the economic effects of chambers of commerce by demonstrating that regional chambers of commerce significantly enhance urban entrepreneurial activity. (3) The study investigates the specific mechanisms through which regional chambers of commerce influence urban entrepreneurial activity,showing that these chambers of commerce enhance social trust and optimize the business environment.These findings deepen the understanding of regional chambers of commerce as a vital form of social organization and enrich research on factors influencing urban entrepreneurial activity.The findings of this study provide valuable insights for fully leveraging the positive role of regional chambers of commerce,optimizing urban entrepreneurial environments,and promoting high-quality economic development.