Digital economy development and enterprise investment – a quasi-natural experiment from the pilot strategy of “broadband China”

Jiqiang Huang and Jizhe Zhang

Journal of the Asia Pacific Economy, 2025, vol. 30, issue 4, 1388-1415

Abstract: This article analyzes the impact of digital economy development on enterprise investment by using the “Broadband China” strategy as an exogenous shock and applying a multi-period difference-in-differences (DID) model to panel data from 2010 to 2020. The results indicate that the digital economy significantly promotes enterprise investment by improving R&D, obtaining more financing from banks, and enhancing internal control. Furthermore, the impact of the digital economy on enterprise investment varies significantly among enterprises that have a high R&D expenditure, are state-owned, large-scale, lower financially constrained, or capital-intensive. The conclusion is supported by a series of robustness tests. This study clarifies the role and influence of government-led digital economy infrastructure construction on micro-enterprise investment decisions and provides recommendations for boosting the development of the digital economy and China’s enterprise investment development.

Date: 2025
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DOI: 10.1080/13547860.2024.2369384

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