Digital M&A and Firm Innovation

Abstract

This study empirically examines how digital M&A affects firm innovation using data from Chinese listed companies from 2006 to 2019. The results show that digital M&A promotes firm innovation, and our findings also suggest that digital M&A enables firms to break away from technology path-dependence to achieve radical innovation and digital innovation. The analysis of different types of digital M&A shows that the innovation effect of vertical digital M&A is smaller than that of horizontal digital M&A. Vertical digital M&A significantly increases industry concentration and may change the competitive structure of the market; the innovation effect of cross-border digital M&A is smaller than that of domestic digital M&A, which may be related to the negative moderating effect of cultural and institutional distance between China and the host country, as well as the restriction of cross-border data flow.

Management Innovation, Digital Orientation, and External Knowledge Search

“…A decentralized structure, supported by big data technology, allows different parts of the organization to have greater autonomy in their data analysis and decisionmaking processes (Z. Zhou et al, 2023). Each team may have unique data requirements and specific knowledge needs.…”

The Impact of Digital Transformation on Manufacturing-Enterprise Innovation: Empirical Evidence from China

“…Some scholars have conducted relevant researches and discussions on enterprise-technology innovation, product innovation, organizational innovation, businessmodel innovation, innovation ecosystems, and other aspects, from the perspective of digital transformation: (1) Technological innovation: digital transformation is considered an important factor in enterprise green-technology innovation, as discussed by Xue et al [5]. According to the study, enterprise green-technology innovation was significantly enhanced by digital transformation [5]; Zhou et al [6] adopted the case-study method to explore how digital transformation promotes the innovation of enterprise mass-customization technology, and refined the process model of digital transformation affecting enterprise mass-customization technology. Agricultural enterprises were found to have a complicated relationship between the quantity and the quality of innovation, due to digital transformation, according to Liu et al [7].…”