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Digital government and firms’ breakthrough innovation: Empirical evidence from China

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  • Li, Hongliang
  • Liang, Enshuo
  • Shi, Xinxu

Abstract

In the digital age, increasing scholarly attention has focused on the link between digital government and firms' breakthrough innovation. This is especially important in a society where technological progress is slowing down. However, no empirical evidence has been found for this link. Therefore, this study examines the mechanisms underlying digital government and firms’ breakthrough innovation and explores the moderating role of firm characteristics in this relationship. Based on digital era governance theory and institutional economics, and using data from Chinese A-share listed firms from 2007 to 2024, this study finds that digital government is positively associated with breakthrough innovation. This evidence is consistent with the roles of enhanced integration and collaboration capabilities, as well as reduced rent-seeking and R&D manipulation. Additionally, we find that this relationship is stronger for firms with greater dynamic capabilities and higher levels of commercial credit. Overall, this study links digital government to breakthrough innovation and extends research on how institutions can support key technological progress for sustainable social development.

Suggested Citation

  • Li, Hongliang & Liang, Enshuo & Shi, Xinxu, 2026. "Digital government and firms’ breakthrough innovation: Empirical evidence from China," Technology in Society, Elsevier, vol. 87(C).
  • Handle: RePEc:eee:teinso:v:87:y:2026:i:c:s0160791x26001867
    DOI: 10.1016/j.techsoc.2026.103397
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