How the Upgrading of Provincial Development Zones Affects the Economic Efficiency of Cities in Central and Western China

The upgrading of provincial development zones plays a crucial role in enhancing urban economic efficiency and promoting high-quality economic development in central and western China. This paper examines the impact of provincial development zones upgrades on the economic efficiency of cities in these regions, utilizing data from 125 prefecture-level cities between 2006 and 2021. The study finds that (1) the upgrading of provincial development zones can significantly improves the economic efficiency of cities in central and western China; (2) the positive effects on economic efficiency are mediated through three mechanisms: increased preferential policies, enhanced industrial agglomeration, and the stimulation of innovation and entrepreneurship; (3) the impact of upgrading is most pronounced in cities with low economic development levels or high marketization. In contrast, cities with high economic development levels or low marketization experience either no significant effect or a weakened effect. Therefore, it is recommended that cities in central and western China tailor their promotion of provincial development zones based on the distinct levels of economic development and marketization. These regions should seize policy opportunities to foster competitive industrial clusters, encourage local enterprises to innovate and start new ventures, and accelerate the upgrading of provincial development zones to further enhance urban economic efficiency.