Can Firm Digitization Process Improve its Competitiveness?--Based on Resource, Information and Risk Perspectives

Abstract

Digitization process, as an important means to achieve high-quality economic development, has an important impact for entering the international market. In order to investigate whether the digitization process can improve corporate competitiveness, this paper empirically examines the impact mechanism of digitization process on corporate competitiveness using a sample of A-share listed companies in Shanghai and Shenzhen from 2010 to 2021. The study finds that firms' digitization process can significantly enhance their competitiveness. This finding remains valid after controlling for endogeneity, dynamic effects, and sample selection bias. In terms of the impact mechanism, firm digitization process can promote their competitiveness through the channels of increasing the trade credit financing, improving the information disclosure quality, and reducing the firm default risk.