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Blockchain adoption and firm performance: The contingent roles of intangible capital and environmental dynamism

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  • Sharma, Prateek
  • Shukla, Dhirendra Mani
  • Raj, Alok

Abstract

Despite the purported benefits of blockchain technology for business applications, it is unclear how blockchain adoption affects firm performance, and large-scale empirical evidence on this relationship remains scarce. Drawing on the dynamic capabilities perspective, we examine the relationship between blockchain adoption and firm performance using a sample of 4994 firm-year observations from 2017 to 2021. Using a dynamic System GMM approach, we show that blockchain adoption significantly increases Tobin's Q (a market-based measure of expected future earnings); however, it has no relation with the current accounting performance measured using return on equity (ROE) and return on assets (ROA). We find that a firm's intangible capital and environmental dynamism positively moderate the relationship between blockchain adoption and Tobin's Q. The former finding reflects market expectations that firms with high intangible capital are better equipped to benefit from blockchain adoption. The latter finding suggests that blockchain adoption strengthens firms' dynamic capabilities, and thus it enables firms to undertake proactive and innovative initiatives in response to an uncertain business environment.

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  • Sharma, Prateek & Shukla, Dhirendra Mani & Raj, Alok, 2023. "Blockchain adoption and firm performance: The contingent roles of intangible capital and environmental dynamism," International Journal of Production Economics, Elsevier, vol. 256(C).
    • Handle: RePEc:eee:proeco:v:256:y:2023:i:c:s0925527322003097
    DOI: 10.1016/j.ijpe.2022.108727
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