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As a new factor of production, data is a new driving force for China's economic development. Digital transformation is highly uncertain, and it is crucial to examine the impact of corporate digital transformation on the integration of digital and real economies. Using all non-financial Chinese A-share listed companies from 2012 to 2021 as the research sample, we investigate the impact of digital transformation on corporate financial asset allocation. The study finds that there is a significant inverted U-shaped relationship between digital transformation and defensive financial asset allocation and a significant positive relationship with profit-seeking financial asset allocation. The mechanism analysis shows that digital transformation impacts the allocation of defensive financial assets through the operational risk of enterprises and promotes the allocation of profit-seeking financial assets through the path of financing arbitrage. Furthermore, the impact of digital transformation on the enterprises' financial asset allocation varies somewhat across property rights, regions, and industries. This finding has some implications for promoting digital transformation and guiding the real economy to transfer from fictitious to substantial.
Liu et al. (Wed,) studied this question.