Smart city rankings and startup ecosystems: An empirical analysis of inverse correlation across 77 smart cities
As cities increasingly adopt smart technologies and seek to foster innovation-driven economies, it is vital to understand how smart city development relates to the strength of local startup ecosystems. This study investigates whether a statistically significant relationship exists between a city’s p...
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LLC "CPC "Business Perspectives"
2025-05-01
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| Series: | Problems and Perspectives in Management |
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| Online Access: | https://www.businessperspectives.org/images/pdf/applications/publishing/templates/article/assets/22085/PPM_2025_02_Kuzior.pdf |
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| author | Aleksandra Kuzior Viktoriia Marhasova Viera Zozuľakova Maria Kočnerova Vitaliia Koibichuk Lyudmila Ryabushka Tetiana Vasylieva |
| author_facet | Aleksandra Kuzior Viktoriia Marhasova Viera Zozuľakova Maria Kočnerova Vitaliia Koibichuk Lyudmila Ryabushka Tetiana Vasylieva |
| author_sort | Aleksandra Kuzior |
| collection | DOAJ |
| description | As cities increasingly adopt smart technologies and seek to foster innovation-driven economies, it is vital to understand how smart city development relates to the strength of local startup ecosystems. This study investigates whether a statistically significant relationship exists between a city’s performance in the smart city ranking and the strength of its startup ecosystem. The study employed available data from the Global Startup Ecosystem Report (by Startup Genome) and the Smart City Index (SCI by the IMD World Competitiveness Center). A balanced panel regression analysis was conducted on a dataset comprising 77 cities across the years 2020, 2021, and 2023 (2022 is excluded as the SCI was not published). The findings reveal that the Random Effects model yielded statistically significant results, indicating a weak (R² = 25.63%) but significant inverse relationship between SCI and startup ecosystem development, which means cities that rank higher on smart city metrics tend to show lower levels of startup ecosystem performance. This counterintuitive result challenges the assumption that technologically advanced cities automatically provide fertile ground for entrepreneurial activity. One possible explanation is that smart cities, dominated by large tech players and rigid governance structures, may present entry barriers for emerging startups. High operational costs, regulatory constraints, and a focus on large-scale infrastructure projects may disincentivize startups from localizing their innovations within these environments. Although the R² suggests that other variables beyond the smart city ranking influence startup development. This study highlights the need for urban policies that actively integrate startup-supportive mechanisms into smart city strategies. |
| format | Article |
| id | doaj-art-14bafb2398804a4daa2e9e84f287c8b3 |
| institution | DOAJ |
| issn | 1727-7051 1810-5467 |
| language | English |
| publishDate | 2025-05-01 |
| publisher | LLC "CPC "Business Perspectives" |
| record_format | Article |
| series | Problems and Perspectives in Management |
| spelling | doaj-art-14bafb2398804a4daa2e9e84f287c8b32025-08-20T03:09:29ZengLLC "CPC "Business Perspectives"Problems and Perspectives in Management1727-70511810-54672025-05-0123240942210.21511/ppm.23(2).2025.2922085Smart city rankings and startup ecosystems: An empirical analysis of inverse correlation across 77 smart citiesAleksandra Kuzior0https://orcid.org/0000-0001-9764-5320Viktoriia Marhasova1https://orcid.org/0000-0001-8582-2158Viera Zozuľakova2https://orcid.org/0000-0001-7035-8743Maria Kočnerova3Vitaliia Koibichuk4https://orcid.org/0000-0002-3540-7922Lyudmila Ryabushka5https://orcid.org/0000-0001-8597-6819Tetiana Vasylieva6https://orcid.org/0000-0003-0635-7978Ph.D., Professor, Dean of the Department of Applied Social Sciences, Faculty of Organization and Management, Silesian University of Technology, PolandDr., Professor, Director, Research Institute of Economics, Kyiv National University of Technologies and Design, UkrainePh.D., Assistant Professor, Department of Philosophy and Politology, Faculty of Arts, Constantine the Philosopher University in Nitra, SlovakiaPh.D., Head of the Department of Philosophy and Politology, Faculty of Arts, Constantine the Philosopher University in Nitra, SlovakiaPh.D., Head of the Department of Economic Cybernetics, Sumy State University, UkrainePh.D. in Economics, Department of Financial Technologies and Entrepreneurship, Sumy State University, UkraineD.Sc., Professor, Department of Financial Technologies and Entrepreneurship, Sumy State University, Ukraine; Faculty of Organization and Management, Silesian University of Technology, Poland; The London Academy of Science and Business, United KingdomAs cities increasingly adopt smart technologies and seek to foster innovation-driven economies, it is vital to understand how smart city development relates to the strength of local startup ecosystems. This study investigates whether a statistically significant relationship exists between a city’s performance in the smart city ranking and the strength of its startup ecosystem. The study employed available data from the Global Startup Ecosystem Report (by Startup Genome) and the Smart City Index (SCI by the IMD World Competitiveness Center). A balanced panel regression analysis was conducted on a dataset comprising 77 cities across the years 2020, 2021, and 2023 (2022 is excluded as the SCI was not published). The findings reveal that the Random Effects model yielded statistically significant results, indicating a weak (R² = 25.63%) but significant inverse relationship between SCI and startup ecosystem development, which means cities that rank higher on smart city metrics tend to show lower levels of startup ecosystem performance. This counterintuitive result challenges the assumption that technologically advanced cities automatically provide fertile ground for entrepreneurial activity. One possible explanation is that smart cities, dominated by large tech players and rigid governance structures, may present entry barriers for emerging startups. High operational costs, regulatory constraints, and a focus on large-scale infrastructure projects may disincentivize startups from localizing their innovations within these environments. Although the R² suggests that other variables beyond the smart city ranking influence startup development. This study highlights the need for urban policies that actively integrate startup-supportive mechanisms into smart city strategies.https://www.businessperspectives.org/images/pdf/applications/publishing/templates/article/assets/22085/PPM_2025_02_Kuzior.pdfpanel data analysissmart citySmart City Indexstartupstartup ecosystem |
| spellingShingle | Aleksandra Kuzior Viktoriia Marhasova Viera Zozuľakova Maria Kočnerova Vitaliia Koibichuk Lyudmila Ryabushka Tetiana Vasylieva Smart city rankings and startup ecosystems: An empirical analysis of inverse correlation across 77 smart cities Problems and Perspectives in Management panel data analysis smart city Smart City Index startup startup ecosystem |
| title | Smart city rankings and startup ecosystems: An empirical analysis of inverse correlation across 77 smart cities |
| title_full | Smart city rankings and startup ecosystems: An empirical analysis of inverse correlation across 77 smart cities |
| title_fullStr | Smart city rankings and startup ecosystems: An empirical analysis of inverse correlation across 77 smart cities |
| title_full_unstemmed | Smart city rankings and startup ecosystems: An empirical analysis of inverse correlation across 77 smart cities |
| title_short | Smart city rankings and startup ecosystems: An empirical analysis of inverse correlation across 77 smart cities |
| title_sort | smart city rankings and startup ecosystems an empirical analysis of inverse correlation across 77 smart cities |
| topic | panel data analysis smart city Smart City Index startup startup ecosystem |
| url | https://www.businessperspectives.org/images/pdf/applications/publishing/templates/article/assets/22085/PPM_2025_02_Kuzior.pdf |
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