DOES DIGITAL TRANSFORMATION MATTER TO EFFICIENCY IMPROVEMENT OF RETAIL ENTERPRISES IN CHINA?

This study aims to explore how digital transformation enhances efficiency in Chinese retail enterprises. Using unbalanced panel data from 78 listed Chinese retail companies from 2010 to 2023, this study conducts an empirical analysis of the impact of digital transformation on the efficiency of retail enterprises. The study employs various total factor productivity (TFP) measurement methods to assess efficiency and uses textual analysis to construct a digital transformation index tailored to the retail industry. The primary finding shows that digital transformation significantly improves the efficiency of retail enterprises. This finding is robust, as confirmed through various robustness tests. In addition, digital transformation benefits enterprises of all scales, but large-scale enterprises experience a significantly greater efficiency improvement than small-scale ones. In regions with low service industry openness, the effect of digital transformation on retail enterprise efficiency is notably higher than in regions with high openness.