Can blockchain technology be effectively integrated into the real economy? Evidence from corporate investment efficiency
As a highly disruptive digital technology, blockchain provides new solutions for reshaping corporate governance mechanisms and improving resource allocation. We empirically examine the relationship between blockchain and corporate investment inefficiency. We find that blockchain can help improve cor...
| Main Authors: | , , , |
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| Format: | Article |
| Language: | English |
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Elsevier
2023-06-01
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| Series: | China Journal of Accounting Research |
| Subjects: | |
| Online Access: | http://www.sciencedirect.com/science/article/pii/S1755309123000023 |
| _version_ | 1797833090753626112 |
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| author | Jing Du Yun Shi Wanfu Li Ying Chen |
| author_facet | Jing Du Yun Shi Wanfu Li Ying Chen |
| author_sort | Jing Du |
| collection | DOAJ |
| description | As a highly disruptive digital technology, blockchain provides new solutions for reshaping corporate governance mechanisms and improving resource allocation. We empirically examine the relationship between blockchain and corporate investment inefficiency. We find that blockchain can help improve corporate investment efficiency, and this result is valid after a series of robustness tests. Blockchain can not only significantly restrain overinvestment but also alleviate underinvestment. Reducing financing costs and alleviating agency conflicts are the two channels through which blockchain is associated with corporate investment efficiency, and financial reporting quality is the condition on which the channels depend. When the CEO holds few shares or the trade credit environment in the region where the company is located is poor, the effect of blockchain is more prominent than it is otherwise. Investment efficiency cannot be improved by blockchain for companies providing blockchain products or services to customers, only for those promoting their own operations and management with blockchain. Ultimately, blockchain can enhance companies’ value by alleviating inefficient investment. We reveal the role of blockchain in corporate investment efficiency, furnish microeconomic evidence for the integration of digital technology and the real economy and provide implications for China to promote digital technology to drive high-quality company development. |
| first_indexed | 2024-04-09T14:19:10Z |
| format | Article |
| id | doaj.art-0bcff94aaab04bda9dd721bdb95d3653 |
| institution | Directory Open Access Journal |
| issn | 1755-3091 |
| language | English |
| last_indexed | 2024-04-09T14:19:10Z |
| publishDate | 2023-06-01 |
| publisher | Elsevier |
| record_format | Article |
| series | China Journal of Accounting Research |
| spelling | doaj.art-0bcff94aaab04bda9dd721bdb95d36532023-05-05T04:40:11ZengElsevierChina Journal of Accounting Research1755-30912023-06-01162100292Can blockchain technology be effectively integrated into the real economy? Evidence from corporate investment efficiencyJing Du0Yun Shi1Wanfu Li2Ying Chen3School of Accounting, Guangdong University of Finance & Economics, Guangzhou, ChinaSchool of Intelligent Finance & Accounting Management, Guangdong University of Finance & Economics, Guangzhou, China; Corresponding authors.School of Accounting, Nanjing University of Finance & Economics, Nanjing, China; Corresponding authors.School of Accounting, Shanghai Lixin University of Accounting and Finance, Shanghai, ChinaAs a highly disruptive digital technology, blockchain provides new solutions for reshaping corporate governance mechanisms and improving resource allocation. We empirically examine the relationship between blockchain and corporate investment inefficiency. We find that blockchain can help improve corporate investment efficiency, and this result is valid after a series of robustness tests. Blockchain can not only significantly restrain overinvestment but also alleviate underinvestment. Reducing financing costs and alleviating agency conflicts are the two channels through which blockchain is associated with corporate investment efficiency, and financial reporting quality is the condition on which the channels depend. When the CEO holds few shares or the trade credit environment in the region where the company is located is poor, the effect of blockchain is more prominent than it is otherwise. Investment efficiency cannot be improved by blockchain for companies providing blockchain products or services to customers, only for those promoting their own operations and management with blockchain. Ultimately, blockchain can enhance companies’ value by alleviating inefficient investment. We reveal the role of blockchain in corporate investment efficiency, furnish microeconomic evidence for the integration of digital technology and the real economy and provide implications for China to promote digital technology to drive high-quality company development.http://www.sciencedirect.com/science/article/pii/S1755309123000023BlockchainCorporate GovernanceCorporate Investment EfficiencyReal Economy |
| spellingShingle | Jing Du Yun Shi Wanfu Li Ying Chen Can blockchain technology be effectively integrated into the real economy? Evidence from corporate investment efficiency China Journal of Accounting Research Blockchain Corporate Governance Corporate Investment Efficiency Real Economy |
| title | Can blockchain technology be effectively integrated into the real economy? Evidence from corporate investment efficiency |
| title_full | Can blockchain technology be effectively integrated into the real economy? Evidence from corporate investment efficiency |
| title_fullStr | Can blockchain technology be effectively integrated into the real economy? Evidence from corporate investment efficiency |
| title_full_unstemmed | Can blockchain technology be effectively integrated into the real economy? Evidence from corporate investment efficiency |
| title_short | Can blockchain technology be effectively integrated into the real economy? Evidence from corporate investment efficiency |
| title_sort | can blockchain technology be effectively integrated into the real economy evidence from corporate investment efficiency |
| topic | Blockchain Corporate Governance Corporate Investment Efficiency Real Economy |
| url | http://www.sciencedirect.com/science/article/pii/S1755309123000023 |
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