Urban data inflows and firm knowledge integration, with micro-level evidence on cross-regional spillovers

Purpose This study aims to examine whether cross-regional urban data inflows at the city level enhance firms’ knowledge integration capability, and identify the underlying mechanisms, source-structure differences and absorptive boundaries of firms. Design/methodology/approach Using a firm-year panel of Chinese A-share listed companies from 2012 to 2023, this study matches city-level incoming data flows to firms based on their registered cities. Firm knowledge integration is operationalized by two distinct recombination outcomes: novel knowledge recombinations and knowledge reapplied recombinations. Findings Urban data inflows significantly increase both types of recombination capability, with a substantially stronger effect on knowledge reapplied recombinations. Source-structure tests show that inflows from high-GDP cities support both novel recombinations and reapplied recombinations, while inflows from low-GDP cities mainly contribute to the latter; the share of high-GDP sources is not independently significant after controlling for total inflow scale. Mechanism evidence indicates that data inflows promote digital invention patenting and intensify patent-transfer activity. Heterogeneity results reveal that a firm’s existing digital knowledge stock and patent transfer experience form a capability threshold. The findings provide firm-level evidence on how cross-regional digital knowledge spillovers enter knowledge production and reshape knowledge recombination. Originality/value This study shifts the focus of research on digital knowledge spillovers from urban innovation outputs to firms’ knowledge restructuring capabilities. It clarifies the micro-level transmission mechanisms and absorption boundaries through which urban data inflows enter firms’ knowledge production, offering micro-level empirical evidence to support the circulation of urban data elements, digital knowledge sharing and regional innovation policies.