Realizing innovation and sustainability: A case study of Macau SAR's smart city development capabilities

The emergence of digital technologies has transformed organizational innovation with important implications for a city, its economy and policymaking. Despite this, research on how capabilities underpin innovation through smart city initiatives is still lacking. To address this gap, we conduct an empirical investigation of smart city initiatives in Macau, a former Portuguese colony and now special administrative region (SAR) of China. The case study adopts a qualitative approach, using data collected through fieldwork observations and in-depth interviews with stakeholders, and analysis of secondary documents. The study develops a stage-based assessment of innovation capabilities related to the use of technologies in smart city development. It identifies three stages characterized by specific city-level innovation capabilities: sensing, seizing and transforming. This study uncovers important features of Macau's innovation system, the intermediary role of platforms, incubators and associations, and the development of technology-enabled capabilities in organizations to help propel the city's transformation. This study, the first of such kind about the city where "the East meets the West," offers first-hand insights into its smart city development, with critiques on existing initiatives and recommendations for future policymaking.