The impact of supply chain digitization on the total factor productivity: evidence from a quasi-natural experiment in China

Supply chain digitization plays a pivotal role in enhancing operational efficiency and catalyzing high-quality growth. This study leverages the Supply Chain Innovation and Application Pilot in China as a quasi-natural experiment to explore the impact of supply chain digitization on total factor productivity. Using data from A-share listed enterprises between 2014 and 2021, we find that supply chain digitization significantly bolsters the total factor productivity (TFP). Further analysis reveals that supply chain digitalization boosts TFP by strengthening supply chain concentration, mitigating information asymmetry between firms, promoting collaborative innovation, and improving both internal and external financing within the supply chain. Additionally, heterogeneity analysis highlights that the positive effects of supply chain digitization are especially pronounced in non-polluting enterprises, capital-intensive industries, and firms with higher levels of internal control. These findings suggest that digitization not only enhances productivity but also fosters a more resilient and efficient supply chain ecosystem.