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Digital transformation and bond credit spread

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  • Cui, Huijie
  • Zhou, Xue
  • Luo, Yonggen

Abstract

We investigate the impact of enterprise digital transformation on bond credit spread based on Chinese A-share listed companies. The empirical results show that digital transformation has a significant impact on reducing credit spread and the negative relation is robust to a number of robustness checks. Subgroup analyses suggest that the reduction effect is more pronounced in state-owned enterprises, non-duality firms, firms with a higher proportion of independent directors, and firms located in high-marketization areas or eastern regions. Increasing total factor productivity, reducing information asymmetry, and enhancing internal control are three possible mechanisms by which digital transformation helps reduce credit spread.

Suggested Citation

  • Cui, Huijie & Zhou, Xue & Luo, Yonggen, 2023. "Digital transformation and bond credit spread," Finance Research Letters, Elsevier, vol. 58(PC).
    • Handle: RePEc:eee:finlet:v:58:y:2023:i:pc:s154461232300925x
    DOI: 10.1016/j.frl.2023.104553
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    Cited by:

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    2. Li, Cong & Liu, Jiaxuan & Zhou, Yunxu & Yang, Benshuo & Sun, Jiawen, 2024. "Can green credit policy alleviate inefficient investment of heavily polluting enterprises? A quasi-natural experiment based on the Green Credit Guidelines," Finance Research Letters, Elsevier, vol. 59(C).
    3. Huang, Zijie & Cao, June & Pan, Lei, 2024. "Greening your way to profits: Green strategies and green revenues," Finance Research Letters, Elsevier, vol. 61(C).

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    More about this item

    Keywords

    Digital transformation; Bond credit spread; Total factor productivity; Information quality; Internal control;
    All these keywords.

    JEL classification:

    • G30 - Financial Economics - - Corporate Finance and Governance - - - General
    • O30 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - General

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