Industrial internet technology, resource reallocation and corporate risk-taking capacity: Evidence from the strategic management perspective

Abstract

By employing machine learning techniques and the Word2Vec model, we quantify the micro-level implementation of Industrial Internet technology in Chinese manufacturing firms from 2010 to 2022. This provides empirical evidence for understanding how the Industrial Internet technology enhances corporate risk-taking capability. Our study shows that adopting this technology increases risk-taking capacity, mainly through resource reallocation. The information layer empowers improvements in organizational structure, the platform layer optimizes labor resources, and the edge/software layers facilitate the integration of supply chain resources. The effect is more pronounced in firms that are technology- and labor-intensive, particularly in environments of high economic policy uncertainty. In conclusion, the Industrial Internet boosts total factor productivity by fostering increased risk-taking.