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Does corporate digital transformation promote disruptive innovation?Evidence from China

Author

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  • Wang, Jiaming
  • Hu, Yumeng
  • Wang, Xiaoyan
  • Wang, Xiangyun

Abstract

Against the growing prominence of the digital economy, leveraging corporate digital transformation (CDT) to foster corporate disruptive innovation (CDI) has become critical for enhancing firm resilience and long-term profitability. Despite this importance, existing research offers limited evidence on the relationship between CDT and CDI in modern market economies. Using panel data on Chinese listed firms from 2013 to 2022, we employ two-way fixed-effects and difference-in-differences (DID) models to examine the causal impact of CDT on CDI and to explore the underlying mechanisms. We introduce top management faultlines (fau) as moderating factors. The results show that CDT significantly promotes CDI, and this effect is further amplified in firms with stronger top management faultlines. Our findings provide new empirical evidence on the innovation consequences of digital transformation and offer important policy and managerial implications for advancing CDT and fostering disruptive innovation.

Suggested Citation

  • Wang, Jiaming & Hu, Yumeng & Wang, Xiaoyan & Wang, Xiangyun, 2026. "Does corporate digital transformation promote disruptive innovation?Evidence from China," Economic Modelling, Elsevier, vol. 160(C).
    • Handle: RePEc:eee:ecmode:v:160:y:2026:i:c:s0264999326001185
    DOI: 10.1016/j.econmod.2026.107589
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