Digital Shift and Overall Factor Productivity: Taking Government Subsidies as a Mediating Influence

This study focuses on Chinese A-share listed companies in Shanghai and Shenzhen from 2012 to 2023. It examines the relationship between digital transformation and total factor productivity, with a particular emphasis on the role of government subsidies. Using a mediation effect model, the research finds that higher levels of digital transformation in enterprises correlate with increased total factor productivity. Additionally, government subsidies play a mediating role in this relationship. The study also highlights that the effect of digital transformation on productivity is more significant in the western region. These findings provide valuable insights for enterprises aiming to improve efficiency and enhance their competitiveness.