As digital technologies proliferate, firms increasingly leverage digital transformation strategically, necessitating new orientations attuned to digital technological change. This study investigates how digital orientation (DORI)- the philosophy of harnessing digital technology scope, digital capabilities, digital ecosystem coordination, and digital architecture configuration for competitive advantage – influences firms’ environmental, social, and governance performance (ESG_per). Analysis of Chinese A-share firms from 2010-2019 reveals DORI is associated with superior ESG_per, operating through the mediating mechanism of enhanced digital finance (DIFIN) as a fund-providing facilitator for sustainability initiatives. Additional analysis uncovers important heterogeneities – private firms, centrally owned state-owned enterprises, politically connected, and emerging companies exhibit the strongest DORI - ESG_per linkages. Prominently, the study findings are validated through a battery of robustness tests, including instrumental variable methods, and propensity score matching. Overall, the results underscore the need for firms to purposefully develop multifaceted digital orientation and furnishes novel theoretical insights and practical implications regarding DORI’s role in improving ESG_per.

We examine the effects of China's 2009–2010 stimulus package for innovation differentials between state-owned firms (SOEs) and privately-owned firms (POEs). Using a unique dataset of Chinese manufacturing firms, we find that in the pre-stimulus period SOEs patent at a lower rate than POEs in the least inventive patent category, and at a comparable rate in the more inventive categories. Post-stimulus, SOEs patent at an even lower rate relative to POEs in the least inventive category, but significant, positive SOE-POE patent rate differentials emerge in more inventive patent categories. The stimulus disproportionately benefited SOEs with higher investment subsidies and lower finance costs—institutional support which we find mediates roughly 45 percent of all positive effects of state-ownership for innovation. Institutional support produces larger SOE-POE innovation differentials among firms in strategic sectors and located in high-marketization provinces, and for centrally controlled SOEs.

Declining worker bargaining power has been advanced as an explanation for dramatic generational changes in the U.S. macroeconomic environment such as the substantial decline in labor’s share of the national income, the loss of consumer purchasing power, and growing income and wealth inequality. In this paper, we investigate microeconomic implications by examining the effect of declining worker power on firm-level investment responses to a labor cost shock (mandated increases in the minimum wage). Over the past four decades, we find that investment-wage sensitivities go from negative to insignificant as management becomes less constrained and can pursue outside options. Consistent with drivers of weakening worker power, investment-wage sensitivity changes are more significant for firms that are more exposed to globalization, technological change, and declining unionization.

This paper examines the impact of the carbon emissions trading scheme (ETS) on directed technological change in the context of Chinese pilot schemes. We focus on firms’ heterogeneity in driving innovation and explore policy variations across pilots. Using a matched difference-in-differences design with a zero-inflated Poisson model, we find that the low-carbon innovation is driven by firms at the intensive margin. On average, a firm files 0.16 additional low-carbon patents annually at the intensive margin. In addition, when looking across pilots, the effect on low-carbon innovation is significant in two pilots, Beijing and Shanghai. We further find that, when looking at firms with different productivity levels measured by output per worker, the pilot ETS encourages low-carbon innovation at the intensive margin but reduces entry into low-carbon innovation at the extensive margin for the more productive firms. Our results suggest that innovation inertia matters, and future policies should encourage smaller firms covered by ETS to start innovation in low-carbon technologies.

Regional carbon emission efficiency has differentiated characteristics under different economic development stages and patterns, and it is significant to identify such characteristics and formulate corresponding policies for high-quality regional development. Based on input-output data related to economic development and energy consumption, a comprehensive evaluation model of Super-SBM and Malmquist-Luenberger (ML) index was constructed to evaluate the spatial and temporal changes and driving forces of CEE, on the basis of which a proposal for collaborative carbon emission reduction zoning is proposed. The results indicated that the carbon emission efficiency (CEE) of the YRD shows a fluctuating upward trend with obvious spatial agglomeration characteristics, and the changes in CEE were closely related to the stage of economic development. The annual average CEE value during each period exhibited positive changes, indicating that economic development gradually shifted toward low carbonization. Moreover, the improvement of CEE gradually shifted from being driven by efficiency change to being driven by technological change. Finally, based on the carbon emissions and CEE characteristics of different cities, a carbon-neutral synergistic path is proposed in terms of industrial transformation, green development and technological support.