Impact of financial development on innovation efficiency of high-tech industrial development zones in Chinese cities

Since 1988, China's high-tech industrial development zones (HIDZ) have achieved remarkable success in economic construction, playing a crucial role in both national and local economic growth. The development and innovation within HIDZ are intricately linked to external financial support. This study empirically examines the influence of financial development (FD) on the innovation efficiency of HIDZ (IEH) based on panel data from various Chinese cities spanning the years 2007–2020. The findings reveal the following: (1) Overall, enhancements in both financial scale (FS) and financial efficiency (FE) significantly contribute to the improvement of IEH. (2) The paper introduces industrial structure rationalization (ISR) as an intermediary variable and utilizes the Mediating Effect Model. The results show that the mediating effect of ISR on FS and FE is approximately 0.0164 and 0.0150, respectively. (3) Heterogeneity analysis of samples across different regions and periods indicates that the impact of FS on IEH follows a pattern of 'western region > eastern region > central region'. Similarly, the impact of FE shows a trend of 'central region > western region > eastern region'. Furthermore, the influence of FD during the period 2007–2012 is more pronounced than that of 2013–2020.