IDEAS home Printed from https://ideas.repec.org/a/gam/jsusta/v15y2023i8p6376-d1118444.html
   My bibliography  Save this article

How Digitalization Shapes Export Product Quality: Evidence from China

Author

Listed:
  • Qianxiao Zhang

    (School of Economics and Finance, Xi’an Jiaotong University, Xi’an 710061, China)

  • Yixue Duan

    (School of Economics and Finance, Xi’an Jiaotong University, Xi’an 710061, China)

Abstract

Digitalization has imposed new production and trade requirements on enterprises. Quality upgrading of export products, a requirement of international consumption upgrading, is also a product of enterprise industrial upgrading. We examine the impact of the digitalization of Chinese listed firms on the quality of their export products from 2011 to 2015 using the panel fixed effects model and chain mediating effects model. The results demonstrate that digitalization has an inverted U-shaped effect on the quality of export products. Further, digitalization can promote the quality upgrading of enterprises’ export products. However, the supporting capacity of digital infrastructure and the decreasing consumption upgrading of foreign customers limit this process. Empirical results show that digitalization can alleviate the financing constraints to improve the quality of export products. Because digitalization can improve human capital quality, this effect can improve the export product quality. A chain mediation effect also occurs. Digitalization alleviates financing constraints to improve human capital and enterprises’ export product quality. By clarifying digitalization⇒, alleviating financing constraints⇒, improving human capital quality⇒ improve export product quality relationships, executives can improve the competitiveness of enterprises in the international market.

Suggested Citation

  • Qianxiao Zhang & Yixue Duan, 2023. "How Digitalization Shapes Export Product Quality: Evidence from China," Sustainability, MDPI, vol. 15(8), pages 1-20, April.
  • Handle: RePEc:gam:jsusta:v:15:y:2023:i:8:p:6376-:d:1118444
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/2071-1050/15/8/6376/pdf
    Download Restriction: no

    File URL: https://www.mdpi.com/2071-1050/15/8/6376/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Kalina Manova, 2013. "Credit Constraints, Heterogeneous Firms, and International Trade," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 80(2), pages 711-744.
    2. Christian Broda & David E. Weinstein, 2006. "Globalization and the Gains From Variety," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 121(2), pages 541-585.
    3. Yu, Honglan & Fletcher, Margaret & Buck, Trevor, 2022. "Managing digital transformation during re-internationalization: Trajectories and implications for performance," Journal of International Management, Elsevier, vol. 28(4).
    4. Kleibergen, Frank & Paap, Richard, 2006. "Generalized reduced rank tests using the singular value decomposition," Journal of Econometrics, Elsevier, vol. 133(1), pages 97-126, July.
    5. AlNuaimi, Bader K. & Kumar Singh, Sanjay & Ren, Shuang & Budhwar, Pawan & Vorobyev, Dmitriy, 2022. "Mastering digital transformation: The nexus between leadership, agility, and digital strategy," Journal of Business Research, Elsevier, vol. 145(C), pages 636-648.
    6. Lianying Hong & Xujun Liu & Huiwen Zhan & Feng Han, 2022. "Use of industrial robots and Chinese enterprises’ export quality upgrading: Evidence from China," The Journal of International Trade & Economic Development, Taylor & Francis Journals, vol. 31(6), pages 860-875, August.
    7. Ilya Ivaninskiy & Irina Ivashkovskaya, 2022. "Are blockchain-based digital transformation and ecosystem-based business models mutually reinforcing? The principal-agent conflict perspective," Eurasian Business Review, Springer;Eurasia Business and Economics Society, vol. 12(4), pages 643-670, December.
    8. Haichao Fan & Yao Amber Li & Stephen R. Yeaple, 2015. "Trade Liberalization, Quality, and Export Prices," The Review of Economics and Statistics, MIT Press, vol. 97(5), pages 1033-1051, December.
    9. Wu, Keping & Fu, Yumei & Kong, Dongmin, 2022. "Does the digital transformation of enterprises affect stock price crash risk?," Finance Research Letters, Elsevier, vol. 48(C).
    10. Bin Yan Ding & Feng Wei, 2022. "Executive resume information disclosure and corporate innovation: Evidence from China," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 43(8), pages 3593-3610, December.
    11. Long Xue & Qianyu Zhang & Xuemang Zhang & Chengyu Li, 2022. "Can Digital Transformation Promote Green Technology Innovation?," Sustainability, MDPI, vol. 14(12), pages 1-20, June.
    12. Haichao Fan & Yao Amber Li & Stephen R. Yeaple, 2015. "Trade Liberalization, Quality, and Export Prices," The Review of Economics and Statistics, MIT Press, vol. 97(5), pages 1033-1051, December.
    13. Fuxia Gao & Chuan Lin & Haomiao Zhai, 2022. "Digital Transformation, Corporate Innovation, and International Strategy: Empirical Evidence from Listed Companies in China," Sustainability, MDPI, vol. 14(13), pages 1-19, July.
    14. Robert C. Feenstra & John Romalis, 2014. "International Prices and Endogenous Quality," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 129(2), pages 477-527.
    15. Huiwen Su & Feiying Cai & Yunting Huang, 2022. "Institutional constraints and exporting of emerging‐market firms: The moderating role of innovation capabilities and digital transformation," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 43(7), pages 2641-2656, October.
    16. Amit K. Khandelwal & Peter K. Schott & Shang-Jin Wei, 2013. "Trade Liberalization and Embedded Institutional Reform: Evidence from Chinese Exporters," American Economic Review, American Economic Association, vol. 103(6), pages 2169-2195, October.
    17. repec:bla:jfinan:v:59:y:2004:i:4:p:1777-1804 is not listed on IDEAS
    18. David Hummels & Peter J. Klenow, 2005. "The Variety and Quality of a Nation's Exports," American Economic Review, American Economic Association, vol. 95(3), pages 704-723, June.
    19. Evangelos Katsamakas, 2022. "Digital Transformation and Sustainable Business Models," Sustainability, MDPI, vol. 14(11), pages 1-5, May.
    20. Veronika Bikse & Inese Lusena-Ezera & Peteris Rivza & Baiba Rivza, 2021. "The Development of Digital Transformation and Relevant Competencies for Employees in the Context of the Impact of the COVID-19 Pandemic in Latvia," Sustainability, MDPI, vol. 13(16), pages 1-17, August.
    21. Elia, Stefano & Giuffrida, Maria & Mariani, Marcello M. & Bresciani, Stefano, 2021. "Resources and digital export: An RBV perspective on the role of digital technologies and capabilities in cross-border e-commerce," Journal of Business Research, Elsevier, vol. 132(C), pages 158-169.
    22. Wen Yue, 2023. "Human capital expansion and firms’ export product quality: Evidence from China," The Journal of International Trade & Economic Development, Taylor & Francis Journals, vol. 32(2), pages 342-363, February.
    23. Abeliansky, Ana L. & Hilbert, Martin, 2017. "Digital technology and international trade: Is it the quantity of subscriptions or the quality of data speed that matters?," Telecommunications Policy, Elsevier, vol. 41(1), pages 35-48.
    24. Zhai, Huayun & Yang, Min & Chan, Kam C., 2022. "Does digital transformation enhance a firm's performance? Evidence from China," Technology in Society, Elsevier, vol. 68(C).
    25. Ying Song & Octavio Escobar & Unai Arzubiaga & Alfredo De Massis, 2022. "The digital transformation of a traditional market into an entrepreneurial ecosystem," Review of Managerial Science, Springer, vol. 16(1), pages 65-88, January.
    26. Jafari-Sadeghi, Vahid & Garcia-Perez, Alexeis & Candelo, Elena & Couturier, Jerome, 2021. "Exploring the impact of digital transformation on technology entrepreneurship and technological market expansion: The role of technology readiness, exploration and exploitation," Journal of Business Research, Elsevier, vol. 124(C), pages 100-111.
    27. Arnd Vomberg & Christian Homburg & Torsten Bornemann, 2015. "Talented people and strong brands: The contribution of human capital and brand equity to firm value," Strategic Management Journal, Wiley Blackwell, vol. 36(13), pages 2122-2131, December.
    28. Yasser Omar Abdallah & Essam Shehab & Ahmed Al-Ashaab, 2022. "Developing a digital transformation process in the manufacturing sector: Egyptian case study," Information Systems and e-Business Management, Springer, vol. 20(3), pages 613-630, September.
    29. Alguacil, Maite & Lo Turco, Alessia & Martínez-Zarzoso, Inmaculada, 2022. "Robot adoption and export performance: Firm-level evidence from Spain," Economic Modelling, Elsevier, vol. 114(C).
    30. Steven N. Kaplan & Luigi Zingales, 1997. "Do Investment-Cash Flow Sensitivities Provide Useful Measures of Financing Constraints?," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 112(1), pages 169-215.
    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. Zhang, Qianxiao & Duan, Yixue, 2024. "Digital empowerment and export quality: The moderate effect of market segmentation," Finance Research Letters, Elsevier, vol. 63(C).
    2. Genhua Hu & Xuejian Zhang & Tingting Zhu, 2024. "A Catalyst for China’s High-Tech Export Competitiveness: Perspective of Technological Innovation," Sustainability, MDPI, vol. 16(5), pages 1-26, March.
    3. Lei Liu & Kai He & Yi Qiao & Peilin Fu & Qinggang Meng, 2023. "Entrepreneurship and Export Product Quality Improvement," Sustainability, MDPI, vol. 15(16), pages 1-20, August.
    4. Ha, Le Thanh, 2023. "An investigation of digital integration's importance on smart and sustainable agriculture in the European region," Resources Policy, Elsevier, vol. 86(PA).
    5. Huwei Wen & Yutong Liu & Fengxiu Zhou, 2023. "Promoting the International Competitiveness of Small and Medium-Sized Enterprises Through Cross-Border E-Commerce Development," SAGE Open, , vol. 13(4), pages 21582440231, November.

    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. Yuping Deng & Yanrui Wu & Helian Xu, 2019. "Environmental Regulation and Export Product Quality: Evidence from Chinese Firms," Economics Discussion / Working Papers 19-14, The University of Western Australia, Department of Economics.
    2. Zhang, Qianxiao & Duan, Yixue, 2024. "Digital empowerment and export quality: The moderate effect of market segmentation," Finance Research Letters, Elsevier, vol. 63(C).
    3. Gideon Ndubuisi & Solomon Owusu, 2021. "How important is GVC participation to export upgrading?," The World Economy, Wiley Blackwell, vol. 44(10), pages 2887-2908, October.
    4. Crinò, Rosario & Ogliari, Laura, 2015. "Financial Frictions, Product Quality, and International Trade," CEPR Discussion Papers 10555, C.E.P.R. Discussion Papers.
    5. Fan, Haichao & Lai, Edwin L.-C. & Li, Yao Amber, 2015. "Credit constraints, quality, and export prices: Theory and evidence from China," Journal of Comparative Economics, Elsevier, vol. 43(2), pages 390-416.
    6. Adriana Peluffo & Juan Ignacio Scasso, 2016. "Destination and source countries: Do they have a role on product quality?," Documentos de Trabajo (working papers) 16-10, Instituto de Economía - IECON.
    7. Gideon Ndubuisi & Solomon Owusu, 2022. "Trust, Efficient Contracting and Export Upgrading," The European Journal of Development Research, Palgrave Macmillan;European Association of Development Research and Training Institutes (EADI), vol. 34(6), pages 2708-2729, December.
    8. Bas, Maria & Paunov, Caroline, 2021. "Input quality and skills are complementary and increase output quality: Causal evidence from Ecuador’s trade liberalization," Journal of Development Economics, Elsevier, vol. 151(C).
    9. Meng, Ning & Milner, Chris & Song, Huasheng, 2020. "Antidumping and heterogeneous quality adjustment of multi-product firms: Evidence from Chinese exporters," Economic Modelling, Elsevier, vol. 92(C), pages 147-161.
    10. Chen, Natalie & Juvenal, Luciana, 2016. "Quality, trade, and exchange rate pass-through," Journal of International Economics, Elsevier, vol. 100(C), pages 61-80.
    11. Song, Xueyin & Huang, Xianhai & Qing, Tao, 2021. "Intellectual property rights protection and quality upgrading: Evidence from China," Economic Modelling, Elsevier, vol. 103(C).
    12. Choi, ByeongHwa, 2023. "The impact of financial development on innovation-based exports: Do all firms benefit equally?," The Quarterly Review of Economics and Finance, Elsevier, vol. 88(C), pages 81-100.
    13. Fan, Haichao & Li, Yao Amber & Yeaple, Stephen R., 2018. "On the relationship between quality and productivity: Evidence from China's accession to the WTO," Journal of International Economics, Elsevier, vol. 110(C), pages 28-49.
    14. Crinò, Rosario & Ogliari, Laura, 2017. "Financial imperfections, product quality, and international trade," Journal of International Economics, Elsevier, vol. 104(C), pages 63-84.
    15. Li, Guangzhong & Li, Jie & Zheng, Ying & Egger, Peter H., 2021. "Does property rights protection affect export quality? Evidence from a property law enactment," Journal of Economic Behavior & Organization, Elsevier, vol. 183(C), pages 811-832.
    16. Hayakawa, Kazunobu & Mukunoki, Hiroshi & Yang, Chih-hai, 2020. "Liberalization for services FDI and export quality: Evidence from China," Journal of the Japanese and International Economies, Elsevier, vol. 55(C).
    17. Dario Fauceglia, 2020. "Exchange rate fluctuations and quality composition of exports: Evidence from Swiss product‐level data," The World Economy, Wiley Blackwell, vol. 43(6), pages 1592-1618, June.
    18. Sisi Yin & Yunshu Gao & Bo Gao, 2022. "Multi‐product firms, product quality heterogeneity and trade liberalisation," The World Economy, Wiley Blackwell, vol. 45(6), pages 1856-1875, June.
    19. Wang, Yaqi & Yu, Miaojie, 2021. "Imports and RMB exchange rate pass-through: The role of quality sorting," Journal of Economic Behavior & Organization, Elsevier, vol. 187(C), pages 470-487.
    20. Alessandra Bonfiglioli & Rosario Crinò & Gino Gancia, 2018. "Firms and Economic Performance: A view from Trade," Working Papers 1034, Barcelona School of Economics.

    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:gam:jsusta:v:15:y:2023:i:8:p:6376-:d:1118444. 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: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    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.