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Does digital transformation decrease firms’ natural dependence?

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  • Gan, Yufei
  • Song, Qingyu
  • Lu, Zhaoying

Abstract

This study examines the relationship between digital transformation and firms’ natural dependence. Using data from Chinese A-share listed companies (2010–2023), we find that digital transformation significantly reduces firms’ dependence on nature, with stronger effects among smaller firms, high-tech industries, and private enterprises. Environmental policy stringency amplifies these effects. Mechanism analysis reveals that digital transformation promotes substantive green technology innovation (particularly source control technologies) and enhances green total factor productivity through improved technical efficiency. This research provides new insights into how technological advancement can systematically reduce firms’ dependence on natural ecosystem services, supporting coordinated digital-green development policies.

Suggested Citation

  • Gan, Yufei & Song, Qingyu & Lu, Zhaoying, 2025. "Does digital transformation decrease firms’ natural dependence?," Finance Research Letters, Elsevier, vol. 86(PD).
    • Handle: RePEc:eee:finlet:v:86:y:2025:i:pd:s1544612325017441
    DOI: 10.1016/j.frl.2025.108490
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    JEL classification:

    • Q50 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - General
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
    • M14 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Corporate Culture; Diversity; Social Responsibility

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