The regional determinants of the new venture formation in china’s car‐sharing economy

Abstract

New ventures play an important role in promoting regional economic growth, employment and innovative development. In China, the new business model centered on the sharing economy has grown rapidly in a short time, especially with regard to car‐sharing, which has become one of the new governmental strategies to promote economic development in China. New car‐sharing ventures have been recognized as the leading sector in sustainable development for the circular economy and resource reuse. This paper explores the regional determinants of new firm formation in the nascent car‐sharing industry in China. We used panel data from 449 car-sharing new ventures established in 257 cities in China from 2011 to 2019 to conduct an empirical analysis. The findings show that the urbanization economy, human capital and venture capital in the region have a positive impact on the establishment of new ventures. At the same time, the regional population density, localization economy, innovation capacity and competitive environment have no significant relationships with the establishment of new car‐sharing firms. This paper provides insights for startups entering the field of car‐sharing and a theoretical basis for the subsequent research on startups in the sharing economy industry.