IDEAS home Printed from https://ideas.repec.org/a/eee/pacfin/v95y2026ics0927538x25003166.html

Digital economy policies and enterprise digital transformation: A quasi-natural experiment of digital economy pilot zones

Author

Listed:
  • Yang, Peng
  • Jiao, Yong
  • Feng, Yiqiang
  • Mu, Manning

Abstract

This study takes the 2019 establishment of the National Pilot Zones for the Innovative Development of the Digital Economy (hereafter, Digital Economy Pilot Zones) as a quasi-natural experiment, using panel data of Chinese listed firms to explore the effects of digital economy policies on firms' digital transformation. The main findings can be summarized as follows. First, the Pilot Zones effectively incentivized firms to undertake digital transformation, which was particularly pronounced for the application of digital technologies in firms’ production, management and marketing processes, underscoring the significant role of digital policy in the early stages of China’s digital economy development. Second, the Pilot Zones enable local firms to obtain government digitalization subsidies, catalyze the construction of digital infrastructure, and attract the spatial clustering of digital enterprises and talent, thereby improving the regional digital ecosystem. Third, the promoting effect on digital transformation is stronger for firms whose executives lack information technology backgrounds, operate in more competitive markets, have higher R&D intensity, and are more labor intensive. Finally, the positive impact of the Pilot Zones is amplified in regions with advanced digital finance and stronger intellectual property protection. These results deepen the understanding of how digital economic policies affect firms' digital transformation in developing countries.

Suggested Citation

  • Yang, Peng & Jiao, Yong & Feng, Yiqiang & Mu, Manning, 2026. "Digital economy policies and enterprise digital transformation: A quasi-natural experiment of digital economy pilot zones," Pacific-Basin Finance Journal, Elsevier, vol. 95(C).
    • Handle: RePEc:eee:pacfin:v:95:y:2026:i:c:s0927538x25003166
    DOI: 10.1016/j.pacfin.2025.102979
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0927538X25003166
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.pacfin.2025.102979?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

    for a different version of it.

    References listed on IDEAS

    as
    1. Zhang, Kaixia & Bu, Caiqi, 2024. "Top managers with information technology backgrounds and digital transformation: Evidence from small and medium companies," Economic Modelling, Elsevier, vol. 132(C).
    2. Siwei Wang & Xin Li & Zibiao Li & Yongwei Ye, 2023. "The effects of government support on enterprises' digital transformation: Evidence from China," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 44(5), pages 2520-2539, July.
    3. Lv, Jin Roc & Ye, Chenghui & Yang, Chen, 2025. "Digital transformation and corporate diversification," Pacific-Basin Finance Journal, Elsevier, vol. 93(C).
    4. Lin, Chen & Lin, Ping & Song, Frank, 2010. "Property rights protection and corporate R&D: Evidence from China," Journal of Development Economics, Elsevier, vol. 93(1), pages 49-62, September.
    5. Tuyen, Bui Quang & Phuong Anh, Do Vu & Hung, Ta Huy & Lan, Mai Thanh, 2025. "Leadership characteristics and digital transformation in an emerging market: The moderating effect of compliance pressure," International Review of Economics & Finance, Elsevier, vol. 98(C).
    6. Ren, Xiaohang & Zeng, Gudian & Sun, Xianming, 2023. "The peer effect of digital transformation and corporate environmental performance: Empirical evidence from listed companies in China," Economic Modelling, Elsevier, vol. 128(C).
    7. Allen, Franklin & Qian, Jun & Qian, Meijun, 2005. "Law, finance, and economic growth in China," Journal of Financial Economics, Elsevier, vol. 77(1), pages 57-116, July.
    8. Pengyu Chen & Yuanyuan Hao, 2022. "Digital transformation and corporate environmental performance: The moderating role of board characteristics," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 29(5), pages 1757-1767, September.
    9. Li, Wencong & Yang, Xingquan & Yin, Xingqiang, 2024. "Digital transformation and labor upgrading," Pacific-Basin Finance Journal, Elsevier, vol. 83(C).
    10. Xiaofang Jia & Baojian Xie & Xingan Wang, 2024. "The impact of network infrastructure on enterprise digital transformation ——A quasi-natural experiment from the “broadband China” Strategy," Applied Economics, Taylor & Francis Journals, vol. 56(12), pages 1363-1380, March.
    11. Cohn, Jonathan B. & Liu, Zack & Wardlaw, Malcolm I., 2022. "Count (and count-like) data in finance," Journal of Financial Economics, Elsevier, vol. 146(2), pages 529-551.
    12. Peng Yang & Weizeng Sun, 2023. "How does digital technology facilitate the green innovation of enterprises? Evidence from China," International Review of Applied Economics, Taylor & Francis Journals, vol. 37(5), pages 621-641, September.
    13. Li, Chengming & Wang, Yilin & Zhou, Zhihan & Wang, Zeyu & Mardani, Abbas, 2023. "Digital finance and enterprise financing constraints: Structural characteristics and mechanism identification," Journal of Business Research, Elsevier, vol. 165(C).
    14. Verhoef, Peter C. & Broekhuizen, Thijs & Bart, Yakov & Bhattacharya, Abhi & Qi Dong, John & Fabian, Nicolai & Haenlein, Michael, 2021. "Digital transformation: A multidisciplinary reflection and research agenda," Journal of Business Research, Elsevier, vol. 122(C), pages 889-901.
    15. Gmyrek, Pawel, & Berg, Janine, & Bescond, David,, 2023. "Generative AI and jobs a global analysis of potential effects on job quantity and quality," ILO Working Papers 995324892702676, International Labour Organization.
    16. Gregory Jackson & Androniki Apostolakou, 2010. "Corporate Social Responsibility in Western Europe: An Institutional Mirror or Substitute?," Journal of Business Ethics, Springer, vol. 94(3), pages 371-394, July.
    17. Nasirov, Shukhrat & Gokh, Irina & Filippaios, Fragkiskos, 2022. "Technological radicalness, R&D internationalization, and the moderating effect of intellectual property protection," Journal of Business Research, Elsevier, vol. 145(C), pages 215-227.
    18. Wilbur Chen & Suraj Srinivasan, 2024. "Going digital: implications for firm value and performance," Review of Accounting Studies, Springer, vol. 29(2), pages 1619-1665, June.
    19. Daron Acemoglu & Pascual Restrepo, 2020. "Robots and Jobs: Evidence from US Labor Markets," Journal of Political Economy, University of Chicago Press, vol. 128(6), pages 2188-2244.
    20. Alessandro Prati & Massimiliano Gaetano Onorato & Chris Papageorgiou, 2013. "Which Reforms Work and under What Institutional Environment? Evidence from a New Data Set on Structural Reforms," The Review of Economics and Statistics, MIT Press, vol. 95(3), pages 946-968, July.
    21. Levine, Ross, 2005. "Finance and Growth: Theory and Evidence," Handbook of Economic Growth, in: Philippe Aghion & Steven Durlauf (ed.), Handbook of Economic Growth, edition 1, volume 1, chapter 12, pages 865-934, Elsevier.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Xiao, Zhongyi & Li, Yuanling & Xiang, Cheng, 2025. "Do suppliers value customer firms' digital transformation? Evidence from trade credit provision," International Review of Financial Analysis, Elsevier, vol. 99(C).
    2. Ding, Jiantao & Yin, Yingkai & Kuang, Jinsong & Ding, Dezhi & Madsen, Dag.Øivind & Yang, Kunyu, 2024. "The impact of enterprise digital transformation on financial mismatch: Empirical evidence from listed companies in China," Finance Research Letters, Elsevier, vol. 66(C).
    3. Zhou, Zhongsheng & Li, Zhuo, 2023. "Corporate digital transformation and trade credit financing," Journal of Business Research, Elsevier, vol. 160(C).
    4. Ying Wu & Yuanyue Deng, 2024. "Does digital transformation crowd out the employment of lower skill labor?," Bulletin of Economic Research, Wiley Blackwell, vol. 76(3), pages 726-748, July.
    5. Han, Zhen & Luo, Erga & Xiong, Xuezhen & Li, Jinkai, 2026. "Government innovation subsidies and enterprise digital transformation: Evidence from Chinese listed companies," Technology in Society, Elsevier, vol. 84(C).
    6. Wu, Xingying & Liu, Shan, 2025. "Gender diversity in top management and its impact on firm-level digital transformation: Evidence from China," Economic Modelling, Elsevier, vol. 145(C).
    7. Maoguang Wang & Jianxiang Zhang & Xinzi Xia, 2026. "Building digital bridges: spillover effects of public infrastructure investment," Eurasian Business Review, Springer;Eurasia Business and Economics Society, vol. 16(1), pages 193-219, March.
    8. Chen, Shaojian, 2026. "Digitalization and cross-regional investments: Evidence from parent-subsidiaries in China," International Review of Financial Analysis, Elsevier, vol. 109(C).
    9. Haowen Tian & Junkai Wang & Yue Cai, 2025. "Artificial Intelligence Adoption and Corporate ESG Performance," Business Strategy and the Environment, Wiley Blackwell, vol. 34(7), pages 8922-8945, November.
    10. Lu, Yingchao & Chang, Hailing & Zhou, Yadan, 2025. "The impact of consumer complaints on corporate digital transformation," International Review of Economics & Finance, Elsevier, vol. 101(C).
    11. Xiang, Jiafeng & Yang, Ge & Chen, Yinying & Zhou, Dong, 2025. "Business group affiliation and corporate digital transformation," Economic Modelling, Elsevier, vol. 147(C).
    12. Yang, Yuhan & Zhang, Chong & Liu, Baoliu & Huang, Yujie & Tai, Yafei, 2024. "Mystery of special government subsidies: How does digital transformation promote enterprise innovation and development?," Economic Analysis and Policy, Elsevier, vol. 83(C), pages 1-16.
    13. Wang, Qian & Du, Zhuo-Ya, 2022. "Changing the impact of banking concentration on corporate innovation: The moderating effect of digital transformation," Technology in Society, Elsevier, vol. 71(C).
    14. Li, Qinyang & Li, Mingrui & Li, Mengru & Li, Tao, 2025. "Digital ripples: The impact of customers' digital transformation on the financing constraints of suppliers," International Review of Financial Analysis, Elsevier, vol. 105(C).
    15. Kunyan Zhu & Siying Chen & Rufei Ma, 2026. "Speed and sustainability: the impact of digital transformation speed on firms’ low-carbon performance," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 28(2), pages 5185-5205, February.
    16. Xu, Yanhui & Deng, Fuhua & Feng, Qianbin, 2025. "The effect of tax enforcement digitalization on corporate digital transformation: Evidence from China's listed companies," Economic Analysis and Policy, Elsevier, vol. 85(C), pages 1105-1134.
    17. Su, Chen & Brookfield, David, 2013. "An evaluation of the impact of stock market reforms on IPO under-pricing in China: The certification role of underwriters," International Review of Financial Analysis, Elsevier, vol. 28(C), pages 20-33.
    18. Jun Liu & Ziwei Wang & Changjin Li & Ruofan Xu, 2024. "Exploring pathways to digital transformation: fsQCA analysis based on the AMO framework," PLOS ONE, Public Library of Science, vol. 19(12), pages 1-18, December.
    19. Agarwal, Natasha & Milner, Chris & Riaño, Alejandro, 2014. "Credit constraints and spillovers from foreign firms in China," Journal of Banking & Finance, Elsevier, vol. 48(C), pages 261-275.
    20. Enrico Maria Fenoaltea & Dario Mazzilli & Aurelio Patelli & Angelica Sbardella & Andrea Tacchella & Andrea Zaccaria & Marco Trombetti & Luciano Pietronero, 2024. "Follow the money: a startup-based measure of AI exposure across occupations, industries and regions," Papers 2412.04924, arXiv.org, revised Dec 2024.

    More about this item

    Keywords

    ;
    ;
    ;
    ;

    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:pacfin:v:95:y:2026:i:c:s0927538x25003166. 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.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with 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/pacfin .

    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.