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Enterprise digital transformation and production efficiency: mechanism analysis and empirical research

Author

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  • Tao Zhang
  • Zhan-Zhong Shi
  • Yi-Rong Shi
  • Neng-Jun Chen

Abstract

In the post-industrial period, traditional Chinese enterprises are facing the awkward situation of being ‘big but not strong’, with their core technologies being controlled by others. The digital transformation of enterprises has not only reshaped business models and industrial boundaries, but also boosted the high-quality development of China’s economy. This paper reviews the existing literature and discovers that digital technology promotes enterprise production efficiency through cost reduction, efficiency improvement, and innovation. Based on the data of listed manufacturing companies in the Shanghai and Shenzhen stock exchanges from 2009 to 2017, this paper constructs a differences in differences (DID) model to empirically study the relationship between digital transformation and production efficiency. The results revealed that the implementation of digital transformation plays a significant role in promoting economic benefits and the results of the lag regression method are still robust. Based on this, combined with the actual situation of Chinese enterprises, this paper proposes countermeasures and suggestions to promote the development of enterprise digital transformation. The conclusion is of great significance for Chinese enterprises to occupy a dominant position in the new wave of global industrial revolution.

Suggested Citation

  • Tao Zhang & Zhan-Zhong Shi & Yi-Rong Shi & Neng-Jun Chen, 2022. "Enterprise digital transformation and production efficiency: mechanism analysis and empirical research," Economic Research-Ekonomska Istraživanja, Taylor & Francis Journals, vol. 35(1), pages 2781-2792, December.
    • Handle: RePEc:taf:reroxx:v:35:y:2022:i:1:p:2781-2792
    DOI: 10.1080/1331677X.2021.1980731
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    Citations

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    Cited by:

    1. Jie Dong, 2023. "Study on the Identification of Financial Risk Path Under the Digital Transformation of Enterprise Based on DEMATEL-ISM-MICMAC," Papers 2305.04216, arXiv.org.
    2. Limin Zhang & Fei Gu & Mingke He, 2024. "The Influence of Digital Transformation on the Reconfigurability and Performance of Supply Chains: A Study of the Electronic, Machinery, and Home Appliance Manufacturing Industries in China," Sustainability, MDPI, vol. 16(7), pages 1-22, March.
    3. Wang, Di & Shao, Xuefeng, 2024. "Research on the impact of digital transformation on the production efficiency of manufacturing enterprises: Institution-based analysis of the threshold effect," International Review of Economics & Finance, Elsevier, vol. 91(C), pages 883-897.
    4. Yuan Wu & Ziwei Li, 2024. "Digital transformation, entrepreneurship, and disruptive innovation: evidence of corporate digitalization in China from 2010 to 2021," Palgrave Communications, Palgrave Macmillan, vol. 11(1), pages 1-11, December.
    5. Yang, Ping & Lv, Yanqin & Chen, Xiaodan & Lv, Juan, 2024. "Digital finance, natural resource constraints and firms' low-carbon behavior: Evidence from listed companies," Resources Policy, Elsevier, vol. 89(C).
    6. Lin, Boqiang & Xie, Yongjing, 2023. "Does digital transformation improve the operational efficiency of Chinese power enterprises?," Utilities Policy, Elsevier, vol. 82(C).
    7. 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).
    8. Ying Wu & Yuanyue Deng, 2024. "Does digital transformation crowd out the employment of lower skill labor?," Bulletin of Economic Research, Wiley Blackwell, vol. 76(3), pages 726-748, July.
    9. Liang Tang & Haifeng Jiang & Shanshan Hou & Jun Zheng & Lianqi Miao, 2023. "The Effect of Enterprise Digital Transformation on Green Technology Innovation: A Quantitative Study on Chinese Listed Companies," Sustainability, MDPI, vol. 15(13), pages 1-18, June.
    10. Chen, Ximing & Yan, Yongjia & Qiu, Ji, 2024. "Can enterprise digital transformation reduce the reliance on bank credit? Evidence from China," Economic Modelling, Elsevier, vol. 132(C).

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