Digital Transformation, Service-Oriented Manufacturing, and Total Factor Productivity: Evidence from A-Share Listed Companies in China

Yan Wang and Ping Han ()
Additional contact information
Yan Wang: School of Economics, Harbin University of Commerce, Harbin 150028, China
Ping Han: School of Economics, Harbin University of Commerce, Harbin 150028, China

Sustainability, 2023, vol. 15, issue 13, 1-24

Abstract: Promoting corporate total factor productivity is important content for high-quality development in the manufacturing industry. Under the background of digitalization, probing whether digital transformation affects corporate total factor productivity is worth further study. We investigate the digitalization level of China’s listed manufacturing companies from a micro perspective using text analysis methods and empirically study whether and how corporate digital transformation affects its total factor productivity. We reveal that: First, moderate digital transformation improves the total factor productivity of manufacturing firms significantly, and there is a nonlinear inverted U-shaped effect between them, which is robust across different methods of measuring digital transformation and TFP and samples and passes the sensitivity analysis. Second, mechanism examination verifies that the promotion effects that digital transformation provides on corporate total factor productivity is mainly through promoting service-oriented manufacturing, technological innovation, and enterprise-scale effect. Third, that promotion effect is more intensified when the company is state-owned, or the company is non-key pollution monitored. Finally, with the deepening of digitalization, its positive promotion effect on corporates’ total factor productivity varies—showing a significant threshold feature, which is much stronger when the degree is lower than the critical value. This paper argues that digitalization has a marginal decreasing boosting effect on enterprise total factor productivity after reaching a certain degree. The study plays an important role in guiding the current promotion of enterprise digital transformation.

Keywords: digital transformation; service-oriented manufacturing; total factor productivity (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2023
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://www.mdpi.com/2071-1050/15/13/9974/pdf (application/pdf)
https://www.mdpi.com/2071-1050/15/13/9974/ (text/html)

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:gam:jsusta:v:15:y:2023:i:13:p:9974-:d:1177328

Access Statistics for this article

Sustainability is currently edited by Ms. Alexandra Wu

More articles in Sustainability from MDPI
Bibliographic data for series maintained by MDPI Indexing Manager ().