The Impact of the Industrial Internet on the Innovation and Development Level of China’s Manufacturing Industry: Under the Perspective of Government Incentives

Abstract

In the era of the digital economy, it has become an inevitable trend for manufacturing enterprises to establish industrial Internet platforms toward achieving transformation and innovative development. However, the current development model of industrial Internet platforms is still imperfect, wherein the application scenario is complex, the investment cost is too high, the return-on-investment cycle is too long, and other factors have hindered the willingness of manufacturing enterprises to employ cloud services and capital investment. For this reason, governments have introduced a series of relevant incentive policies to promote the development of industrial Internet platforms and the transformation and upgrading of manufacturing enterprises. Considering the role of government incentives, this study first constructs an evolutionary game model with local governments, manufacturing enterprises, and industrial Internet platforms as the main players. Then, the dynamic change process of each game player’s strategy choice and the stable state of the system evolution under multiple scenarios are analyzed, and the validity of the conclusions is verified through a numerical simulation analysis. Finally, the statistical data of 28 provinces in China from 2018 to 2020 are used to conduct an empirical test to explore the impact of the industrial Internet on the transformation and innovation development of the manufacturing industry and the role of government incentives. The results show that the development of the industrial Internet has a significant role in promoting the innovation and development of the manufacturing industry; government incentives can promote the innovation and development of the industrial Internet and manufacturing industry, but incentives should not be too generous; and the impact of developing the industrial Internet on the level of innovation input/output of the manufacturing industry shows obvious regional differences. This study takes the local government as an independent game participant into consideration, which enriches the research field of combining evolutionary game theory with the transformation and innovative development of the manufacturing industry. In addition, this study provides theoretical guidance and practical references for the government to formulate incentive policies to promote the development of industrial Internet platforms and for manufacturing enterprises to utilize these platforms to carry out innovation and perform upgrades.