Promoting Innovation and the Digital Economy

Key finding of the study

Findings reveal that the digital economy positively impacts enterprise innovativeness and enterprises that pay attention to the digital economy are more likely to increase their R&D expenditure and decrease their sales and finance expenses, encouraging innovations.

Authors

Wu Qinqin, Jiangsu University, China

Sikandar Ali Qalati, Liaocheng University, China

Rana Yassir Hussain, University of Education Lahore, Pakistan

Hira Irshad, Superior University, Pakistan

Kayhan Tajeddini, Sheffield Hallam University, Tokyo International University, Japan

Thilini Chathurika Gamage, Sabaragamuwa University of Sri Lanka, Sri Lanka

Summary

China's digital economy has made remarkable achievements, profoundly impacting enterprise innovation. Based on an unbalanced panel dataset covering more than two thousand manufacturing listed companies in the A-stock market of China during the 2011 to 2018 period, this paper employs a two-way fixed effects model to examine the effects of attention to the digital economy on enterprise innovation. Additionally, the intermediate effect model is adopted to check the underlying mechanisms of cost control in enterprises, which is also impacted by the digital economy. Findings reveal that the digital economy positively impacts enterprise innovativeness and enterprises that pay attention to the digital economy are more likely to increase their R&D expenditure and decrease their sales and finance expenses, encouraging innovations.

Published in

Journal of Innovation & Knowledge

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