IDEAS home Printed from https://ideas.repec.org/a/eee/energy/v300y2024ics0360544224010442.html
   My bibliography  Save this article

Dose digital transformation contribute to improving financing efficiency? Evidence and implications for energy enterprises in China

Author

Listed:
  • Zhang, Ruchuan
  • Gao, Weiyan
  • Chen, Shanshan
  • Zhou, Li
  • Li, Aijun

Abstract

The high penetration of digitalization has emerged as a crucial driving force in enhancing financing efficiency across global enterprises. However, few studies have explored the potential effects of digital transformation on enterprises' financing efficiency, wherein the financing system is composed of fund procurement and application stages. Under such background, this study constructs a novel network DEA model with dominance probability and adjusted utility to analyze the multiple-dimensional performance of the financing system. Then an empirical econometric model is developed from the theoretical analysis and applied to Chinese energy enterprises for the period 2015-2021. The main findings are summarized as follows. First, our research demonstrates that digital transformation can significantly increase financing efficiency, with fund procurement identified as the lagging stage to efficiency improvement. Second, when considering the heterogeneous analysis, digital transformation is particularly effective in alleviating financing constraints and enhancing operating performance for clean energy enterprises. Finally, with regard to the mechanism's explorations, digital transformation increases enterprises' financing efficiency by reducing the ownership concentration and management expense rate. These findings provide an empirical foundation for the advancement of digital transformation, and also hold significant implications for narrowing financing efficiency gaps across energy enterprises.

Suggested Citation

  • Zhang, Ruchuan & Gao, Weiyan & Chen, Shanshan & Zhou, Li & Li, Aijun, 2024. "Dose digital transformation contribute to improving financing efficiency? Evidence and implications for energy enterprises in China," Energy, Elsevier, vol. 300(C).
    • Handle: RePEc:eee:energy:v:300:y:2024:i:c:s0360544224010442
    DOI: 10.1016/j.energy.2024.131271
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0360544224010442
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.energy.2024.131271?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Fare, Rolf & Grosskopf, Shawna, 1996. "Productivity and intermediate products: A frontier approach," Economics Letters, Elsevier, vol. 50(1), pages 65-70, January.
    2. Yingying Zhou & Zilin Shi & Fengyi Lei & Wanxuan Sun & Jiaxuan Zhang, 2022. "Effect of Environmental Information Disclosure on the Financing Efficiency of Enterprises—Evidence from China’s Listed Energy Companies," Sustainability, MDPI, vol. 14(24), pages 1-21, December.
    3. Huang, Chenchen & Lin, Boqiang, 2023. "Promoting decarbonization in the power sector: How important is digital transformation?," Energy Policy, Elsevier, vol. 182(C).
    4. Apostolos Christopoulos & Ioannis Dokas & Sofia Katsimardou & Eleftherios Spyromitros, 2022. "The Malmquist Productivity measure for UK-listed firms in the aftermath of the global financial crisis," Operational Research, Springer, vol. 22(2), pages 1617-1634, April.
    5. Li, Quan & Chen, Huimin & Chen, Yang & Xiao, Tong & Wang, Li, 2023. "Digital economy, financing constraints, and corporate innovation," Pacific-Basin Finance Journal, Elsevier, vol. 80(C).
    6. Cui, Lin & Wang, Yanshu, 2023. "Can corporate digital transformation alleviate financial distress?," Finance Research Letters, Elsevier, vol. 55(PB).
    7. David Tilson & Kalle Lyytinen & Carsten Sørensen, 2010. "Research Commentary ---Digital Infrastructures: The Missing IS Research Agenda," Information Systems Research, INFORMS, vol. 21(4), pages 748-759, December.
    8. Yin, Hongying & Jin, Xin & Quan, Xiaofeng & Yu, Junli, 2022. "Does social network improve corporate financing efficiency? Evidence from China," Pacific-Basin Finance Journal, Elsevier, vol. 74(C).
    9. Livdan, Dmitry & Nezlobin, Alexander, 2021. "Investment, capital stock, and replacement cost of assets when economic depreciation is non-geometric," Journal of Financial Economics, Elsevier, vol. 142(3), pages 1444-1469.
    10. Chen, Shanshan & Zhang, Ruchuan & Li, Peiwen & Li, Aijun, 2023. "How to improve the performance of China's energy-transport-economy-environment system: An analysis based on new strategy parallel-series input-output data envelopment analysis models," Energy, Elsevier, vol. 281(C).
    11. Guo, Xiaochuan & Li, Mengmeng & Wang, Yanlin & Mardani, Abbas, 2023. "Does digital transformation improve the firm’s performance? From the perspective of digitalization paradox and managerial myopia," Journal of Business Research, Elsevier, vol. 163(C).
    12. Lu Zhang & Jiakui Chen & Ziyi Liu & Zhiyuan Hao, 2023. "Digital Inclusive Finance, Financing Constraints, and Technological Innovation of SMEs—Differences in the Effects of Financial Regulation and Government Subsidies," Sustainability, MDPI, vol. 15(9), pages 1-20, April.
    13. Martynova, Marina & Renneboog, Luc, 2009. "What determines the financing decision in corporate takeovers: Cost of capital, agency problems, or the means of payment?," Journal of Corporate Finance, Elsevier, vol. 15(3), pages 290-315, June.
    14. James S. Ang & Rebel A. Cole & James Wuh Lin, 2000. "Agency Costs and Ownership Structure," Journal of Finance, American Finance Association, vol. 55(1), pages 81-106, February.
    15. Yan, Lina & Ling, Xuan & Wang, Zhitao & Xu, Yinuo, 2023. "Can mixed-ownership reform boost the digital transformation of state-owned enterprises?," Economic Analysis and Policy, Elsevier, vol. 79(C), pages 647-663.
    16. Biswas, Swarnava (Sonny) & Koufopoulos, Kostas, 2020. "Bank competition and financing efficiency under asymmetric information," Journal of Corporate Finance, Elsevier, vol. 65(C).
    17. Zhang, Ruchuan & Wei, Qian & Li, Aijun & Ren, LiYing, 2022. "Measuring efficiency and technology inequality of China's electricity generation and transmission system: A new approach of network Data Envelopment Analysis prospect cross-efficiency models," Energy, Elsevier, vol. 246(C).
    18. Zeng, Shihong & Jiang, Chunxia & Ma, Chen & Su, Bin, 2018. "Investment efficiency of the new energy industry in China," Energy Economics, Elsevier, vol. 70(C), pages 536-544.
    19. Li, Chengming & Huo, Peng & Wang, Zeyu & Zhang, Weiguang & Liang, Feiyan & Mardani, Abbas, 2023. "Digitalization generates equality? Enterprises’ digital transformation, financing constraints, and labor share in China," Journal of Business Research, Elsevier, vol. 163(C).
    20. Niu, Yuhao & Wen, Wen & Wang, Sai & Li, Sifei, 2023. "Breaking barriers to innovation: The power of digital transformation," Finance Research Letters, Elsevier, vol. 51(C).
    21. Zhou, Zhongsheng & Li, Zhuo, 2023. "Corporate digital transformation and trade credit financing," Journal of Business Research, Elsevier, vol. 160(C).
    22. Chen, Fengqin & Huyghebaert, Nancy & Lin, Sen & Wang, Lihong, 2019. "Do multiple large shareholders reduce agency problems in state-controlled listed firms? Evidence from China," Pacific-Basin Finance Journal, Elsevier, vol. 57(C).
    23. Chunfang Cao & Wenxuan Hou & Xiumei Liu & Hongbo Pan, 2023. "Do Excess Funds Make Financially Constrained Firms Better Off? Evidence from IPOs in China," Abacus, Accounting Foundation, University of Sydney, vol. 59(3), pages 818-846, September.
    24. Sueyoshi, Toshiyuki & Yuan, Yan & Goto, Mika, 2017. "A literature study for DEA applied to energy and environment," Energy Economics, Elsevier, vol. 62(C), pages 104-124.
    25. Liu, Cenjie & Fang, Jiayu & Xie, Rui, 2021. "Energy policy and corporate financial performance: Evidence from China's 11th five-year plan," Energy Economics, Elsevier, vol. 93(C).
    26. Xin Yang & Minghui Li & Yujie Yang, 2023. "Signing auditors’ experience and client investment efficiency," Asia-Pacific Journal of Accounting & Economics, Taylor & Francis Journals, vol. 30(6), pages 1444-1476, November.
    27. Xu, Bin & Chen, Jianbao, 2021. "How to achieve a low-carbon transition in the heavy industry? A nonlinear perspective," Renewable and Sustainable Energy Reviews, Elsevier, vol. 140(C).
    28. Liu, Haiyue & Zhang, Ruchuan & Zhou, Li & Li, Aijun, 2023. "Evaluating the financial performance of companies from the perspective of fund procurement and application: New strategy cross efficiency network data envelopment analysis models," Energy, Elsevier, vol. 269(C).
    29. Dengler, Katharina & Matthes, Britta, 2018. "The impacts of digital transformation on the labour market: Substitution potentials of occupations in Germany," Technological Forecasting and Social Change, Elsevier, vol. 137(C), pages 304-316.
    30. Omar Farooq, 2015. "Effect of ownership concentration on capital structure: evidence from the MENA region," International Journal of Islamic and Middle Eastern Finance and Management, Emerald Group Publishing Limited, vol. 8(1), pages 99-113, April.
    31. Lu Guo & WeiYa Long & Zhimin Dai, 2021. "Manufacturing R&D investment efficiency and financing constraints: evidence from China," Applied Economics, Taylor & Francis Journals, vol. 53(6), pages 676-687, February.
    32. Huifeng Xu & Xiaodong Xu & Junli Yu, 2021. "The Impact of Mandatory CSR Disclosure on the Cost of Debt Financing: Evidence from China," Emerging Markets Finance and Trade, Taylor & Francis Journals, vol. 57(8), pages 2191-2205, June.
    33. Liu, Yong-Jun & Yang, Guo-Sen & Zhang, Wei-Guo, 2024. "A novel regret-rejoice cross-efficiency approach for energy stock portfolio optimization," Omega, Elsevier, vol. 126(C).
    34. Li, Chengming & Wang, Yilin & Zhou, Zhihan & Wang, Zeyu & Mardani, Abbas, 2023. "Digital finance and enterprise financing constraints: Structural characteristics and mechanism identification," Journal of Business Research, Elsevier, vol. 165(C).
    35. Wang, Sai & Wen, Wen & Niu, Yuhao & Li, Xin, 2024. "Digital transformation and corporate labor investment efficiency," Emerging Markets Review, Elsevier, vol. 59(C).
    36. Hema Yoganarasimhan, 2020. "Search Personalization Using Machine Learning," Management Science, INFORMS, vol. 66(3), pages 1045-1070, March.
    37. Verhoef, Peter C. & Broekhuizen, Thijs & Bart, Yakov & Bhattacharya, Abhi & Qi Dong, John & Fabian, Nicolai & Haenlein, Michael, 2021. "Digital transformation: A multidisciplinary reflection and research agenda," Journal of Business Research, Elsevier, vol. 122(C), pages 889-901.
    38. João A C Santos & Andrew Winton, 2019. "Bank Capital, Borrower Power, and Loan Rates," The Review of Financial Studies, Society for Financial Studies, vol. 32(11), pages 4501-4541.
    39. Cook, Wade D. & Seiford, Larry M., 2009. "Data envelopment analysis (DEA) - Thirty years on," European Journal of Operational Research, Elsevier, vol. 192(1), pages 1-17, January.
    40. Wang, Di & Liu, Guangqiang & Xie, Linlin, 2023. "Can compulsory liability insurance reduce agency costs? Evidence from China," Research in International Business and Finance, Elsevier, vol. 65(C).
    41. Bollaert, Helen & Lopez-de-Silanes, Florencio & Schwienbacher, Armin, 2021. "Fintech and access to finance," Journal of Corporate Finance, Elsevier, vol. 68(C).
    42. Omar Farooq, 2015. "Effect of ownership concentration on capital structure: evidence from the MENA region," International Journal of Islamic and Middle Eastern Finance and Management, Emerald Group Publishing Limited, vol. 8(1), pages 99-113, April.
    43. Bart Frijns & Dimitris Margaritis & Maria Psillaki, 2012. "Firm efficiency and stock returns," Journal of Productivity Analysis, Springer, vol. 37(3), pages 295-306, June.
    44. Othman, Norfaizah & Abdul-Majid, Mariani & Abdul-Rahman, Aisyah, 2017. "Partnership financing and bank efficiency," Pacific-Basin Finance Journal, Elsevier, vol. 46(PA), pages 1-13.
    45. Yang, Zhonghai & Lu, Yang & Tan, Wenhao, 2021. "Monetary policy tightening, accounting information comparability, and underinvestment: Evidence from China," Economic Analysis and Policy, Elsevier, vol. 70(C), pages 123-147.
    46. Yuanying Chi & Meng Xiao & Yuexia Pang & Menghan Yang & Yuhao Zheng, 2022. "Financing Efficiency Evaluation and Influencing Factors of Hydrogen Energy Listed Enterprises in China," Energies, MDPI, vol. 15(1), pages 1-16, January.
    47. Jin, Feifei & Cai, Yuhang & Zhou, Ligang & Ding, Tao, 2023. "Regret-rejoice two-stage multiplicative DEA models-driven cross-efficiency evaluation with probabilistic linguistic information," Omega, Elsevier, vol. 117(C).
    48. Nikolov, Boris & Schmid, Lukas & Steri, Roberto, 2021. "The Sources of Financing Constraints," Journal of Financial Economics, Elsevier, vol. 139(2), pages 478-501.
    49. Lin Nan & Xiaoyan Wen, 2014. "Financing and Investment Efficiency, Information Quality, and Accounting Biases," Management Science, INFORMS, vol. 60(9), pages 2308-2323, September.
    50. Ren, Xiaohang & Zeng, Gudian & Zhao, Yang, 2023. "Digital finance and corporate ESG performance: Empirical evidence from listed companies in China," Pacific-Basin Finance Journal, Elsevier, vol. 79(C).
    51. Kao, Chiang, 2018. "A classification of slacks-based efficiency measures in network data envelopment analysis with an analysis of the properties possessed," European Journal of Operational Research, Elsevier, vol. 270(3), pages 1109-1121.
    52. Kai Chang & Xiaochang Cheng & Yiran Wang & Qiming Liu & Jie Hu, 2023. "The impacts of ESG performance and digital finance on corporate financing efficiency in China," Applied Economics Letters, Taylor & Francis Journals, vol. 30(4), pages 516-523, February.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Zhou, Lijuan & Zhang, Ruchuan & Zhang, Aizhen & Li, Miao & Li, Aijun, 2024. "Understanding the role of energy sector in the outbreak of epidemic in China: An analysis based on SEIDR epidemic model, dynamic input-output model and resource allocation DEA model," Energy, Elsevier, vol. 305(C).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Liu, Haiyue & Zhang, Ruchuan & Zhou, Li & Li, Aijun, 2023. "Evaluating the financial performance of companies from the perspective of fund procurement and application: New strategy cross efficiency network data envelopment analysis models," Energy, Elsevier, vol. 269(C).
    2. Tian, Lichuan & Sun, Kai & Yang, Jie & Zhao, Yang, 2024. "Does digital economy affect corporate ESG performance? New insights from China," International Review of Economics & Finance, Elsevier, vol. 93(PB), pages 964-980.
    3. Zheng, Deyuan & Song, Hang & Zhao, Chunguang & Liu, Yujiao & Zhao, Wenhao, 2024. "Is it possible for semiconductor companies to reduce carbon emissions through digital transformation? Evidence from China," International Journal of Production Economics, Elsevier, vol. 272(C).
    4. Zhou, Zhongsheng & Li, Zhuo, 2023. "Corporate digital transformation and trade credit financing," Journal of Business Research, Elsevier, vol. 160(C).
    5. Bai, Hengrui & Huang, Lingyu & Wang, Ziqi, 2024. "Supply chain financing, digital financial inclusion and enterprise innovation: Evidence from China," International Review of Financial Analysis, Elsevier, vol. 91(C).
    6. Peng Liang & Xinhui Sun, 2024. "Does digital transformation promote the green innovation of China’s listed companies?," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 26(9), pages 22199-22235, September.
    7. Li, Cong & Liu, Jiaxuan & Liu, Yuwei & Wang, Xiaoyu, 2023. "Can digitalization empowerment improve the efficiency of corporate capital allocation? —Evidence from China," Economic Analysis and Policy, Elsevier, vol. 80(C), pages 1794-1810.
    8. Khurram, Muhammad Usman & Abbassi, Wajih & Chen, Yifan & Chen, Lifeng, 2024. "Outward foreign investment performance, digital transformation, and ESG performance: Evidence from China," Global Finance Journal, Elsevier, vol. 60(C).
    9. Wu, Jinghua & Liang, Yanping & Liu, Wei, 2024. "The dark side of corporate digital transformation: Evidence from excess perk consumption of executives," Finance Research Letters, Elsevier, vol. 61(C).
    10. Zareie, Mobina & Attig, Najah & El Ghoul, Sadok & Fooladi, Iraj, 2024. "Firm digital transformation and corporate performance: The moderating effect of organizational capital," Finance Research Letters, Elsevier, vol. 61(C).
    11. Zhu, Yongyi & Yu, Di, 2024. "Digital transformation and firms’ bargaining power: Evidence from China," Journal of Business Research, Elsevier, vol. 183(C).
    12. Chen, Shanshan & Zhang, Ruchuan & Li, Peiwen & Li, Aijun, 2023. "How to improve the performance of China's energy-transport-economy-environment system: An analysis based on new strategy parallel-series input-output data envelopment analysis models," Energy, Elsevier, vol. 281(C).
    13. Wang, Sai & Wen, Wen & Niu, Yuhao & Li, Xin, 2024. "Digital transformation and corporate labor investment efficiency," Emerging Markets Review, Elsevier, vol. 59(C).
    14. Changling Sun & Ziang Lin & Marek Vochozka & Zuzana Vincúrová, 2022. "Digital transformation and corporate cash holdings in China’s A-share listed companies," Oeconomia Copernicana, Institute of Economic Research, vol. 13(4), pages 1081-1116, December.
    15. Liu, Fengzhong & Liu, Xing, 2024. "Digital transformation is not a painless change:Evidence from corporate risk," Pacific-Basin Finance Journal, Elsevier, vol. 86(C).
    16. Wu, Desheng & Xie, Yu, 2024. "Unveiling the impact of public data access on collaborative reduction of pollutants and carbon emissions: Evidence from open government data policy," Energy Economics, Elsevier, vol. 138(C).
    17. Chen, Ya & Pan, Yongbin & Liu, Haoxiang & Wu, Huaqing & Deng, Guangwei, 2023. "Efficiency analysis of Chinese universities with shared inputs: An aggregated two-stage network DEA approach," Socio-Economic Planning Sciences, Elsevier, vol. 90(C).
    18. Yande Gong & Joe Zhu & Ya Chen & Wade D. Cook, 2018. "DEA as a tool for auditing: application to Chinese manufacturing industry with parallel network structures," Annals of Operations Research, Springer, vol. 263(1), pages 247-269, April.
    19. Xiao, Huijuan & Wang, Daoping & Qi, Yu & Shao, Shuai & Zhou, Ya & Shan, Yuli, 2021. "The governance-production nexus of eco-efficiency in Chinese resource-based cities: A two-stage network DEA approach," Energy Economics, Elsevier, vol. 101(C).
    20. Ancillai, Chiara & Sabatini, Andrea & Gatti, Marco & Perna, Andrea, 2023. "Digital technology and business model innovation: A systematic literature review and future research agenda," Technological Forecasting and Social Change, Elsevier, vol. 188(C).

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:energy:v:300:y:2024:i:c:s0360544224010442. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.journals.elsevier.com/energy .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.