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Talent magnets in China: Can talent attraction policies catalyze digital transformation in enterprises?

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  • Hua, Zesu
  • Kong, Shuning
  • Yu, Yihua

Abstract

This study examines the impact of local talent attraction policies on enterprise digital transformation using a quasi-experimental design and data from A-share listed companies in China (2012–2019). Employing a difference-in-differences approach, we find that these policies significantly enhance digital transformation by improving human capital and expanding external digital resources. The effects are more pronounced in enterprises with large external executive compensation gaps, newly-appointed executive teams, younger leaders, better reputations, weaker financing constraints, and those in technology-intensive operations. Moreover, our analysis reveals that greater policy intensity, including more substantial housing or monetary subsidies, significantly promotes digital transformation. The findings highlight the importance of governmental talent management in fostering digital innovation and provide evidence for policies aimed at attracting skilled talent to boost industrial competitiveness.

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  • Hua, Zesu & Kong, Shuning & Yu, Yihua, 2025. "Talent magnets in China: Can talent attraction policies catalyze digital transformation in enterprises?," China Economic Review, Elsevier, vol. 90(C).
    • Handle: RePEc:eee:chieco:v:90:y:2025:i:c:s1043951x25000343
    DOI: 10.1016/j.chieco.2025.102376
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    Keywords

    Digital transformation; Talent attraction policies; Human capital; Digitalization resources; Quasi-experimental design;
    All these keywords.

    JEL classification:

    • G34 - Financial Economics - - Corporate Finance and Governance - - - Mergers; Acquisitions; Restructuring; Corporate Governance
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • M12 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Personnel Management; Executives; Executive Compensation
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
    • R58 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Regional Government Analysis - - - Regional Development Planning and Policy

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