Digital transformation and its effect on resource allocation efficiency and productivity in Chinese corporations

Bibliographic Data

ID11237753
AuthorsWeijie Jiang (0000-0003-0976-5299, Ningbo University, corresponding author), Jiaye Li (0009-0003-5383-8229, Ningbo University)
Year2024
Volume78
Pages102638
Publication date2024-09-01
Peer ReviewedYes
Open AccessYes
TypeARTICLE
VenueTechnology in Society (JOURNAL)
Journal identifiersISSN: 0160-791X • E-ISSN: 1879-3274
PublisherElsevier BV (PUBLISHER)
DOI10.1016/j.techsoc.2024.102638
OpenAlexW4399796189
LanguageEN
Citations received27
References cited40

Digital technology improves the capacity for collecting, processing, and sharing information, enabling corporations to optimize resource allocation. Based on data from Chinese A-share listed corporations between 2008 and 2020, the study investigates the relationship between digital transformation and resource reallocation. The findings indicate that digital transformation significantly enhances the allocation efficiency of capital and labor. Specifically, doubling the frequency of digital transformation terms can correct capital input deviation by approximately 9.5 % and labor input deviation by around 7.3 %. The enhancement primarily stems from mitigating excessive input inefficiencies, while demonstrating insignificant effects on underinvestment scenarios. Moreover, these results are consistent across an array of robustness tests, including Bartik IV and difference-in-differences strategy using the “Broadband China” policy as a quasi-natural experiment. Mechanism analysis reveals that alleviating external information frictions and enhancing internal information utilization constitute the primary channels through which digital transformation fosters resource allocation efficiency. Furthermore, digital transformation not only raises the overall total factor productivity (TFP) through resource reallocation but also directly fosters the growth of corporate TFP

Business · China · Digital transformation · Economic growth · Economic system · Economics · Environmental economics · Industrial organization · Management · Natural resource economics · Political science · Productivity · Resource (disambiguation · Resource allocation · Transformation (genetics · Business and Economic Development · Computer Science · Economic and Technological Innovation · Economic Development and Digital Transformation

Tools

Open DOIOpen Access