Abstract This study takes China's A‐share listed companies from 2010 to 2023 as the research sample, and empirically tests the impact of digital transformation on the “short‐term borrowing for long‐term investment” (STBLTI) of firms and its mechanisms. The results show that digital transformation can significantly inhibit STBLTI. This inhibitory relationship is more pronounced in non‐state‐owned firms, small‐scale firms, and firms with dispersed ownership. As for the mechanisms, digital transformation can effectively inhibit STBLTI by enhancing product competitiveness, mitigating internal and external information asymmetry, and raising the proportion of long‐term liabilities to total liabilities. In addition, the investment vitality of the regional real economy exerts a positive moderating effect on the inhibitory effect of digital transformation on STBLTI, while the degree of corporate financialization exerts a negative one. This study provides enterprises with new evidence on how to curb STBLTI through digital transformation and robust support for the government's policy direction of developing the real economy and preventing “from real to virtual”.
Mo et al. (Sun,) studied this question.