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We use data from Chinese A-share manufacturing firms from 2010 to 2023 to study the impact of data elements marketization on total factor productivity (TFP) using dual machine learning. We find that data elements marketization improves manufacturing firms’ TFP, thus breaking the productivity paradox. Following a number of robustness tests, this conclusion remains true. Meanwhile, this effect is more powerful among manufacturing firms that are non-state-owned, large scale, high-tech, and have a high-level regional business environment. Our research lays the micro-foundations for unleashing data elements and cracking the productivity paradox.
Xu et al. (Mon,) studied this question.