IDEAS home Printed from https://ideas.repec.org/a/eee/ecmode/v134y2024ics0264999324000440.html
   My bibliography  Save this article

Digitalization through supply chains: Evidence from the customer concentration of Chinese listed companies

Author

Listed:
  • Liu, Rui
  • Zheng, Linhao
  • Chen, Zheang
  • Cheng, Mengyao
  • Ren, Yuzhuo

Abstract

This study investigates an observed contradiction between economic theory and empirical trends, specifically, whether digitalization reduces customer concentration. Previous research has primarily examined the impact of digital elements from a macro perspective. Using data from China's listed companies from 2012 to 2020, we examine the effect of digitalization on customer concentration using our micro-founded production network model, which explores the endogenous selection mechanism of customers for suppliers. Upon controlling for firm entry and exit, we conclude, theoretically and empirically, that firms with higher levels of digitalization have lower customer concentration, since they have less information asymmetry with their suppliers and higher “technology matching efficiency” to attract more customers. Evidence for the transmission of digital elements along the supply chains is also provided. Our findings underscore that firms with higher digitalization suppliers can enhance their own digitalization and attract a larger customer base, emphasizing the importance of supply chains in digitalization.

Suggested Citation

  • Liu, Rui & Zheng, Linhao & Chen, Zheang & Cheng, Mengyao & Ren, Yuzhuo, 2024. "Digitalization through supply chains: Evidence from the customer concentration of Chinese listed companies," Economic Modelling, Elsevier, vol. 134(C).
    • Handle: RePEc:eee:ecmode:v:134:y:2024:i:c:s0264999324000440
    DOI: 10.1016/j.econmod.2024.106688
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0264999324000440
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.econmod.2024.106688?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    More about this item

    Keywords

    Digital elements; Customer concentration; Supply chains; Production networks;
    All these keywords.

    JEL classification:

    • D22 - Microeconomics - - Production and Organizations - - - Firm Behavior: Empirical Analysis
    • L14 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Transactional Relationships; Contracts and Reputation
    • L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:ecmode:v:134:y:2024:i:c:s0264999324000440. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/inca/30411 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.