Digital innovation and firm internationalization: Insights from publicly listed firms in China

You Wu and Wanyu Xu

Economic Modelling, 2025, vol. 151, issue C

Abstract: This study explores the role of digital innovation in facilitating the internationalization of firms in emerging markets, focusing on the perspective of knowledge flow. Analyzing data from Chinese publicly listed firms between 2004 and 2022, we find that digital innovation—both product and process— positively influences firm internationalization. This relationship is further strengthened by a firm's market presence and its environmental, social, and governance ranking. The international flow of a firm's knowledge—reflected in the adoption and diffusion of its innovations in foreign markets—is crucial in linking digital innovation to firm internationalization. Firms that engage in more digital innovation and have broader global knowledge dissemination achieve higher levels of internationalization. Heterogeneity analysis reveals that the impact of digital innovation on internationalization significantly differs based on firm characteristics, such as size, ownership type, and capability. This study underscores the crucial importance of digital innovation and global knowledge dissemination in firms' international expansion.

Keywords: Digital innovation; Multinational enterprises; Knowledge flow and dissemination; Internationalization; Emerging market (search for similar items in EconPapers)
JEL-codes: F23 L25 M16 O32 (search for similar items in EconPapers)
Date: 2025
References: Add references at CitEc
Citations:

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S026499932500207X
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:ecmode:v:151:y:2025:i:c:s026499932500207x

DOI: 10.1016/j.econmod.2025.107212

Access Statistics for this article

Economic Modelling is currently edited by S. Hall and P. Pauly

More articles in Economic Modelling from Elsevier
Bibliographic data for series maintained by Catherine Liu ().