首页|The research on non-linear relationship between enterprise digital transformation and stock price crash risk

The research on non-linear relationship between enterprise digital transformation and stock price crash risk

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  • NETL
  • NSTL
  • Elsevier
© 2023 Elsevier Inc.This paper uses data from Chinese A-share listed enterprises to examine digital transformation's impact and intrinsic mechanisms on the risk of stock price collapse. This paper finds that the impact of digital transformation on the risk of stock price collapse follows an inverted U-shaped trend characterized by initial exacerbation followed by subsequent suppression. Furthermore, we find that as most Chinese enterprises are still positioned at the left end of the inverted U-shaped curve in terms of their level of digital transformation, the impact of digital transformation on the risk of the stock price collapse is mainly characterized by exacerbation. Moreover, we discover that digital transformation influences the risk of stock price collapse by increasing agency costs and fostering managerial overconfidence. Lastly, the heterogeneity analysis results indicate that digital transformation's impact on the risk of stock price collapse varies among different types of enterprises. The exacerbation effect of the former on the latter is primarily observed in small-sized and non-high-tech enterprises. Additionally, as the digital transformation progresses, large-sized enterprises and high-tech enterprises can benefit more rapidly from its positive empowering effects.

Agency costDigital transformationInverse U-shapeOverconfidenceStock price crash

Ai Y.、Chi Z.、Sun G.、Zhou H.、Kong T.

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Business School Dalian University of Foreign Languages

School of Finance Nanjing University of Finance and EconomicsSchool of Finance Nanjing University of Finance and EconomicsSchool of Finance Nanjing University of Finance and Economics||Collaborative Innovation Center for Emissions Trading System Co-constructed by the Province and Ministry||||Institute of Industrial Economics of Chinese Academy of Social Sciences||

School of Finance Nanjing University of Finance and Economics

Department of Economic and Trade Management Liaoning Vocational College of Light Industry

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2023

10.1016/j.najef.2023.101984

The North American journal of economics and finance

The North American journal of economics and finance

ISSN：1062-9408
年,卷(期)：2023.68(Sep.)
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