Digital transformation has emerged as a pivotal strategy for enterprises navigating the challenges of the modern economy. This study examines how corporate digital transformation affects investment efficiency in China’s food and beverage industry, using panel data from Shanghai and Shenzhen A-share listed companies over the period 2010–2023. Employing a text-mining approach to measure the degree of digital transformation and the Richardson’s model to estimate investment efficiency, we find that digital transformation significantly enhances corporate investment efficiency, we find that digital transformation significantly enhances corporate investment efficiency. Mechanism analysis reveals that this effect operates primarily through two channels: the reduction of agency costs and the alleviation of financing constraints. Heterogeneity tests further show that the positive impact is more pronounced among firms located in eastern China, state-owned enterprises, companies audited by non-Big Four accounting firms, and those in the growth and maturity stages of the corporate life cycle. These findings contribute to the literature on the economic consequences of digital transformation and offer practical insights for firms and policymakers seeking to leverage digitalization as a pathway to more efficient capital allocation in emerging market contexts.
Zeng et al. (Wed,) studied this question.