Digitalization and firm resilience: Evidence from the COVID-19 pandemic in Zambia

Over the past few decades, internet access and the adoption of 3G/4G wireless networks have expanded across Africa. This digital transformation brings both opportunities and challenges. In this study, we use panel data from two rounds of the World Bank Enterprise Survey conducted in Zambia—before and after the COVID-19 outbreak—to examine the impact of digitalization on firm resilience in a developing-country context. Our analysis employs entropy balancing and difference-in-differences models and remains robust across various estimation techniques. A key finding is that firms that had adopted digital technologies before the pandemic experienced less revenue loss than other firms. The average effects are large but vary significantly across industries. These findings underscore the potential of digital strategies in mitigating economic disruptions. • COVID-19 reduced Zambian firms' revenues by about 30 percentage points. • Firms with websites lost about 15 percentage points less revenue. • Digitalization effects were strongest in low-contact industries. • Study applies firm-level panel data with entropy balancing for causality.