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The Impact of Digital Transformation on Total Factor Productivity of Enterprises

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  • Rui-qi Li
  • Haiying Ma
  • Xinyue Wang

Abstract

In recent years, China's economic development has transitioned into a new phase, shifting from the pursuit of rapid growth to a period of high quality development that prioritizes the enhancement of total factor productivity. Historically, China predominantly relied on extensive growth methods to bolster economic efficiency. However, in light of economic policy uncertainty, trade protectionism, international political friction and other external shocks, there has been a notable deceleration in productivity growth. Consequently, promoting the deep fusion of digital technology and traditional economic modalities while ameliorating overall factor productivity within micro-enterprises has emerged as an imperative undertaking in this new stage. The study of micro-level digital transformation in enterprises holds significant theoretical and practical implications for enhancing productivity. This paper employs panel data of all Shanghai and Shenzhen A-share listed enterprises from 2011 to 2021 to construct a keyword matrix for digital transformation, conduct quantitative analysis on its impact on enterprise total factor productivity, and explore the relationship and influence mechanism between digital transformation, financing constraints, and organizational redundancy. Additionally, heterogeneity analysis is performed based on property rights nature, enterprise scale, and overseas background of senior executives to offer valuable insights for the government in formulating tailored policies for enterprises with different characteristics. This study also provides empirical evidence for enterprises to develop customized digital transformation strategies.

Suggested Citation

  • Rui-qi Li & Haiying Ma & Xinyue Wang, 2024. "The Impact of Digital Transformation on Total Factor Productivity of Enterprises," International Journal of Business and Management, Canadian Center of Science and Education, vol. 19(4), pages 1-31, July.
    • Handle: RePEc:ibn:ijbmjn:v:19:y:2024:i:4:p:31
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    References listed on IDEAS

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    More about this item

    JEL classification:

    • R00 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General - - - General
    • Z0 - Other Special Topics - - General

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