Digital transformation and firm cost stickiness: Evidence from China

Yufeng Chen and Jing Xu

Finance Research Letters, 2023, vol. 52, issue C

Abstract: Digital transformation has increasingly become an important determinant in business decision-making. Using the data of Chinese listed companies from 2011 to 2020, this paper investigates the impact of digital transformation on cost stickiness. The empirical results demonstrate that digital transformation can significantly inhibit cost stickiness by reducing adjustment cost and management optimistic expectation, and the inhibiting effect is persistent. Moreover, digital transformation has a more significant inhibiting effect on the non-state-owned firm and the material resource cost stickiness. This paper provides a new perspective for cost reduction promotes the deep integration of digital and real economies.

Keywords: Digital transformation; Cost stickiness; Adjustment cost; Management optimistic expectation; Agency problem (search for similar items in EconPapers)
Date: 2023
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (44)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S1544612322006869
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:52:y:2023:i:c:s1544612322006869

DOI: 10.1016/j.frl.2022.103510

Access Statistics for this article

Finance Research Letters is currently edited by R. Gençay

More articles in Finance Research Letters from Elsevier
Bibliographic data for series maintained by Catherine Liu ().