Artificial intelligence and cross-regional capital flows: Evidence from corporate cross-regional investment

Against the backdrop of the construction of a national unified market and accelerated corporate digital transformation, Artificial Intelligence (AI)—as a general-purpose digital technology characterized by lowering prediction costs—can influence the spatial allocation of corporate capital by mitigating cross-regional operational frictions. Based on panel data of China’s A-share listed companies from 2009 to 2023, this study empirically examines the impact of AI adoption on corporate cross-regional investment and its underlying mechanisms. The results indicate that AI adoption significantly promotes corporate cross-regional investment, a finding that remains valid across a battery of robustness checks. Mechanism analysis reveals that AI facilitates cross-regional investment by reducing information asymmetry and coordination costs, while enhancing prediction and risk management capabilities. Furthermore, heterogeneity analysis shows that the promoting effect of AI is more pronounced in non-state-owned enterprises (non-SOEs), large-scale enterprises, and non-high-tech enterprises, as well as in regions with more developed digital finance, superior digital infrastructure, and a higher degree of marketization. These findings suggest that AI exhibits characteristics of "compensating for deficiencies" and "environmental complementarity." This study provides firm-level empirical evidence for understanding how AI reduces spatial frictions and drives cross-regional capital flows. It also offers policy implications for improving the supply of digital infrastructure, optimizing the business environment, and promoting differentiated AI diffusion policies.