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Exploring the Digital Era: Has Digital Technology Innovation Reshaped Investment Efficiency in Chinese Enterprises?

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  • Xiaobing LAI

    (School of Economics & Management, Southeast University, Jiulong Lake Campus, Southeast University, Nanjing City, Jiangsu Province, P. R. China 211189; Economic Growth Centre, School of Social Sciences, Nanyang Technological University, 50 Nanyang Avenue, Singapore 639798)

  • Lei QUAN

    (School of Economics & Management, Southeast University, Jiulong Lake Campus, Southeast University, Nanjing City, Jiangsu Province, P. R. China 211189; Financial Technology Engineering and Technology Development Center, Guangdong University of Finance, Guangzhou City, Guangdong Province, P. R. China 510521)

  • Chong GUO

    (School of Economics & Management, Southeast University, Jiulong Lake Campus, Southeast University, Nanjing City, Jiangsu Province, P. R. China 211189)

  • Xing GAO

    (School of Finance & Economics, Hunan University of Finance and Economics, Changsha City, Hunan Province, P. R. China 410205)

Abstract

In the digital era, advancements in technologies such as artificial intelligence, big data, and cloud computing are revolutionizing corporate investment strategies, yet academic research has struggled to keep pace with these rapid developments. Utilizing data from 2005 to 2021 for Chinese A-share listed companies, this study examines the impact of digital technology innovation on corporate investment efficiency. The findings reveal that firms with higher levels of digital technology innovation tend to have greater investment efficiency. This improvement stems from the role of digital innovation in driving digital transformation, improving information quality, addressing management issues, reducing reliance on short-term financing, and lowering financial risks. Notably, the positive effects are more pronounced in non-state-owned enterprises, high-tech industries, and well-developed financial markets. The article broadens our understanding of the economic effects of digital technology innovation and the factors contributing to corporate investment efficiency growth strategies in a rapidly evolving digital economy.

Suggested Citation

  • Xiaobing LAI & Lei QUAN & Chong GUO & Xing GAO, 2023. "Exploring the Digital Era: Has Digital Technology Innovation Reshaped Investment Efficiency in Chinese Enterprises?," Economic Growth Centre Working Paper Series 2302, Nanyang Technological University, School of Social Sciences, Economic Growth Centre.
    • Handle: RePEc:nan:wpaper:2302
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    JEL classification:

    • G11 - Financial Economics - - General Financial Markets - - - Portfolio Choice; Investment Decisions
    • G31 - Financial Economics - - Corporate Finance and Governance - - - Capital Budgeting; Fixed Investment and Inventory Studies
    • O3 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights

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