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Industrial digitalization and industry manufacturing performance: cross-industry evidence from China

Year: 2026
Type: article
Abstract: Industrial digitalization has become an important driver of manufacturing transformation. This paper examines the impact of industrial digitalization on manufacturing performance using cross-industry data from China. A balanced panel dataset covering 30 manufacturing industries from 2012 to 2020 is constructed, and both static fixed effects models and a dynamic panel generalized method of moments (GMM) approach are employed to address potential endogeneity and capture dynamic effects. Manufacturing performance is measured using comparative labor productivity, while industrial digitalization is quantified through an input–output-based index of digital investment intensity. The empirical results show that industrial digitalization has a significant positive effect on manufacturing performance, and this effect remains robust in the dynamic specification. Heterogeneity analysis reveals that the positive impact is more pronounced in labor-intensive and capital-intensive industries, while it is insignificant in technology-intensive industries. Mechanism analysis further indicates that industrial digitalization enhances manufacturing performance by increasing R&D intensity, suggesting a partial mediating effect, through which industrial digitalization enhances manufacturing performance both directly and indirectly through innovation. In addition, industries with lower initial levels of digitalization tend to experience larger performance gains. Overall, the findings suggest that industrial digitalization plays a crucial role in improving manufacturing productivity and competitiveness, although its effects vary across different types of industries.
DOI: 10.1080/23322039.2026.2728297
Language: English
Open Access status: gold
Estimated APC paid: $1,165
OpenAlex ID: W7212436772
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Cites: 43
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