{"status":"ok","message-type":"work","message-version":"1.0.0","message":{"indexed":{"date-parts":[[2026,2,13]],"date-time":"2026-02-13T18:28:53Z","timestamp":1771007333280,"version":"3.50.1"},"reference-count":34,"publisher":"MDPI AG","issue":"9","license":[{"start":{"date-parts":[[2023,9,19]],"date-time":"2023-09-19T00:00:00Z","timestamp":1695081600000},"content-version":"vor","delay-in-days":0,"URL":"https:\/\/creativecommons.org\/licenses\/by\/4.0\/"}],"funder":[{"name":"National Natural Science Foundation of China","award":["72103221"],"award-info":[{"award-number":["72103221"]}]},{"name":"National Natural Science Foundation of China","award":["2020TQ0048"],"award-info":[{"award-number":["2020TQ0048"]}]},{"name":"National Natural Science Foundation of China","award":["2021M700460"],"award-info":[{"award-number":["2021M700460"]}]},{"name":"China Postdoctoral Science Foundatio","award":["72103221"],"award-info":[{"award-number":["72103221"]}]},{"name":"China Postdoctoral Science Foundatio","award":["2020TQ0048"],"award-info":[{"award-number":["2020TQ0048"]}]},{"name":"China Postdoctoral Science Foundatio","award":["2021M700460"],"award-info":[{"award-number":["2021M700460"]}]}],"content-domain":{"domain":[],"crossmark-restriction":false},"short-container-title":["Systems"],"abstract":"<jats:p>Digital transformation is seen as an \u201celixir\u201d for companies to improve their economic performance and expand their market power in the digital economy. Therefore, how does digital transformation affect enterprises\u2019 market power? This paper used machine learning to construct a digital transformation index and used panel data of listed enterprises from 2008 to 2020 to study the impact of digital transformation on market power and its mechanism of action. The findings showed that digital transformation significantly increases market power, and this conclusion still holds after considering potential endogeneity issues and conducting robustness tests. The results of mechanism analysis revealed that digital transformation facilitates endogenous scale expansion and promotes merger and acquisition (M&amp;A), which reshapes firm boundaries and, thus, enhances market power. This paper revealed new changes in the micro-organization of enterprises in the context of digital transformation and provided micro-evidence for the industrial organization effect of digital transformation.<\/jats:p>","DOI":"10.3390\/systems11090479","type":"journal-article","created":{"date-parts":[[2023,9,19]],"date-time":"2023-09-19T02:47:52Z","timestamp":1695091672000},"page":"479","update-policy":"https:\/\/doi.org\/10.3390\/mdpi_crossmark_policy","source":"Crossref","is-referenced-by-count":15,"title":["Digital Transformation, Firm Boundaries, and Market Power: Evidence from China\u2019s Listed Companies"],"prefix":"10.3390","volume":"11","author":[{"given":"Yang","family":"Xu","sequence":"first","affiliation":[{"name":"School of Economics, Minzu University of China, Beijing 100081, China"},{"name":"China Institute for Vitalizing Border Areas and Enriching the People, Minzu University of China, Beijing 100081, China"}]},{"ORCID":"https:\/\/orcid.org\/0000-0001-6760-8625","authenticated-orcid":false,"given":"Chengming","family":"Li","sequence":"additional","affiliation":[{"name":"School of Economics, Minzu University of China, Beijing 100081, China"},{"name":"China Institute for Vitalizing Border Areas and Enriching the People, Minzu University of China, Beijing 100081, China"}]}],"member":"1968","published-online":{"date-parts":[[2023,9,19]]},"reference":[{"key":"ref_1","doi-asserted-by":"crossref","first-page":"107","DOI":"10.1016\/j.jinteco.2008.05.003","article-title":"Foreign Direct Investment and Mark-up Dynamics: Evidence from Spanish Firms","volume":"76","author":"Sembenelli","year":"2008","journal-title":"J. Int. Econ."},{"key":"ref_2","first-page":"71","article-title":"Monetary Policy and Market Power in Banking","volume":"83","year":"2004","journal-title":"Economics"},{"key":"ref_3","doi-asserted-by":"crossref","first-page":"139","DOI":"10.1016\/j.jinteco.2018.04.009","article-title":"Tariffs and Markups in Retailing","volume":"113","author":"Cole","year":"2018","journal-title":"J. Int. Econ."},{"key":"ref_4","doi-asserted-by":"crossref","first-page":"105594","DOI":"10.1016\/j.econmod.2021.105594","article-title":"Tariff Liberalization and Firm-Level Markups in Indian Manufacturing","volume":"103","author":"Mukherjee","year":"2021","journal-title":"Econ. Model."},{"key":"ref_5","doi-asserted-by":"crossref","first-page":"70","DOI":"10.1016\/j.jinteco.2018.02.005","article-title":"Acquisitions, Markups, Efficiency, and Product Quality: Evidence from India","volume":"112","author":"Stiebale","year":"2018","journal-title":"J. Int. Econ."},{"key":"ref_6","doi-asserted-by":"crossref","first-page":"103324","DOI":"10.1016\/j.resourpol.2023.103324","article-title":"Artificial Intelligence, Resource Reallocation, and Corporate Innovation Efficiency: Evidence from China\u2019s Listed Companies","volume":"81","author":"Li","year":"2023","journal-title":"Resour. Policy"},{"key":"ref_7","doi-asserted-by":"crossref","first-page":"118","DOI":"10.1016\/j.jsis.2019.01.003","article-title":"Understanding Digital Transformation: A Review and a Research Agenda","volume":"28","author":"Vial","year":"2019","journal-title":"J. Strateg. Inf. Syst."},{"key":"ref_8","doi-asserted-by":"crossref","first-page":"102196","DOI":"10.1016\/j.irfa.2022.102196","article-title":"Firms\u2019 Digitalization and Stock Price Crash Risk","volume":"82","author":"Jiang","year":"2022","journal-title":"Int. Rev. Financ. Anal."},{"key":"ref_9","doi-asserted-by":"crossref","unstructured":"Nagle, F., Seamans, R., and Tadelis, S. (2020). Transaction Cost Economics in the Digital Economy: A Research Agenda. SSRN Electron. J.","DOI":"10.2139\/ssrn.3661856"},{"key":"ref_10","doi-asserted-by":"crossref","first-page":"103198","DOI":"10.1016\/j.resourpol.2022.103198","article-title":"How to Improve Environment, Resources and Economic Efficiency in the Digital Era?","volume":"80","author":"Hao","year":"2023","journal-title":"Resour. Policy"},{"key":"ref_11","doi-asserted-by":"crossref","first-page":"104555","DOI":"10.1016\/j.respol.2022.104555","article-title":"Artificial Intelligence and Industrial Innovation: Evidence from German Firm-Level Data","volume":"51","author":"Rammer","year":"2022","journal-title":"Res. Policy"},{"key":"ref_12","doi-asserted-by":"crossref","first-page":"102458","DOI":"10.1016\/j.technovation.2022.102458","article-title":"Digital Innovation and Performance of Manufacturing Firms: An Affordance Perspective","volume":"119","author":"Liu","year":"2022","journal-title":"Technovation"},{"key":"ref_13","doi-asserted-by":"crossref","first-page":"529","DOI":"10.1016\/j.jfineco.2004.05.004","article-title":"What Drives Merger Waves?","volume":"77","author":"Harford","year":"2005","journal-title":"J. Financ. Econ."},{"key":"ref_14","doi-asserted-by":"crossref","first-page":"2177","DOI":"10.1111\/jofi.12055","article-title":"Private and Public Merger Waves","volume":"68","author":"Maksimovic","year":"2013","journal-title":"J. Financ."},{"key":"ref_15","doi-asserted-by":"crossref","first-page":"2116","DOI":"10.1080\/00207543.2017.1324224","article-title":"The Role of Digital Technologies for the Service Transformation of Industrial Companies","volume":"56","author":"Ardolino","year":"2017","journal-title":"Int. J. Prod. Res."},{"key":"ref_16","doi-asserted-by":"crossref","first-page":"295","DOI":"10.1016\/S0304-405X(03)00211-3","article-title":"Stock Market Driven Acquisitions","volume":"70","author":"Shleifer","year":"2001","journal-title":"SSRN Electron. J. Financ. Econ."},{"key":"ref_17","doi-asserted-by":"crossref","first-page":"224","DOI":"10.1016\/j.intman.2012.04.002","article-title":"Overcoming the Liability of Outsidership\u2014The Challenge of HQ of the Global Firm","volume":"18","author":"Vahlne","year":"2012","journal-title":"J. Int. Manag."},{"key":"ref_18","doi-asserted-by":"crossref","first-page":"2859","DOI":"10.1287\/mnsc.2014.2013","article-title":"The Distinct Effects of Information Technology and Communication Technology on Firm Organization","volume":"60","author":"Bloom","year":"2014","journal-title":"Manag. Sci."},{"key":"ref_19","doi-asserted-by":"crossref","first-page":"46","DOI":"10.1016\/j.futures.2017.03.006","article-title":"The Forthcoming Artificial Intelligence (AI) Revolution: Its Impact on Society and Firms","volume":"90","author":"Makridakis","year":"2017","journal-title":"Futures"},{"key":"ref_20","doi-asserted-by":"crossref","first-page":"642","DOI":"10.1016\/j.jbusres.2020.10.033","article-title":"Digital Transformation and Customer Value Creation in Made in Italy SMEs: A Dynamic Capabilities Perspective","volume":"123","author":"Matarazzo","year":"2021","journal-title":"J. Bus. Res."},{"key":"ref_21","first-page":"91","article-title":"The Slow Growth of New Plants: Learning about Demand?","volume":"83","author":"Foster","year":"2012","journal-title":"SSRN Electron. J."},{"key":"ref_22","doi-asserted-by":"crossref","first-page":"1291","DOI":"10.1093\/qje\/qjw012","article-title":"Quantifying the Sources of Firm Heterogeneity","volume":"131","author":"Hottman","year":"2016","journal-title":"Q. J. Econ."},{"key":"ref_23","doi-asserted-by":"crossref","first-page":"375","DOI":"10.1177\/0001839216674457","article-title":"State Ownership and Firm Innovation in China: An Integrated View of Institutional and Efficiency Logics","volume":"62","author":"Zhou","year":"2016","journal-title":"Adm. Sci. Q."},{"key":"ref_24","doi-asserted-by":"crossref","first-page":"103396","DOI":"10.1016\/j.resourpol.2023.103396","article-title":"Natural Resource Consumption and Industrial Green Transformation: Does the Digital Economy Matter?","volume":"81","author":"Ran","year":"2023","journal-title":"Resour. Policy"},{"key":"ref_25","doi-asserted-by":"crossref","first-page":"104266","DOI":"10.1016\/j.scs.2022.104266","article-title":"Disentangling the Complex Impacts of Urban Digital Transformation and Environmental Pollution: Evidence from Smart City Pilots in China","volume":"88","author":"Wu","year":"2022","journal-title":"Sustain. Cities Soc."},{"key":"ref_26","doi-asserted-by":"crossref","first-page":"488","DOI":"10.1016\/j.iref.2023.02.007","article-title":"The Effect of Digital Transformation on Real Economy Enterprises\u2019 Total Factor Productivity","volume":"85","author":"Cheng","year":"2023","journal-title":"Int. Rev. Econ. Financ."},{"key":"ref_27","doi-asserted-by":"crossref","first-page":"e13916","DOI":"10.1016\/j.heliyon.2023.e13916","article-title":"The Impact of Digital Transformation on Innovation Performance\u2014the Mediating Role of Innovation Factors","volume":"9","author":"Chen","year":"2023","journal-title":"Heliyon"},{"key":"ref_28","doi-asserted-by":"crossref","first-page":"100219","DOI":"10.1016\/j.jik.2022.100219","article-title":"Does the Bank\u2019s FinTech Innovation Reduce Its Risk-Taking? Evidence from China\u2019s Banking Industry","volume":"7","author":"Li","year":"2022","journal-title":"J. Innov. Knowl."},{"key":"ref_29","doi-asserted-by":"crossref","first-page":"1630","DOI":"10.1257\/aer.104.6.1630","article-title":"US Food Aid and Civil Conflict","volume":"104","author":"Nunn","year":"2014","journal-title":"Am. Econ. Rev."},{"key":"ref_30","doi-asserted-by":"crossref","first-page":"529","DOI":"10.1111\/j.1467-937X.2008.00480.x","article-title":"An Assignment Theory of Foreign Direct Investment","volume":"75","author":"Nocke","year":"2008","journal-title":"Rev. Econ. Stud."},{"key":"ref_31","doi-asserted-by":"crossref","unstructured":"Blonigen, B.A., and Pierce, J.R. (2016). Evidence for the Effects of Mergers on Market Power and Efficiency. SSRN Electron. J.","DOI":"10.3386\/w22750"},{"key":"ref_32","doi-asserted-by":"crossref","first-page":"1229","DOI":"10.1111\/j.1467-937X.2007.00466.x","article-title":"Cross-Border Mergers as Instruments of Comparative Advantage","volume":"74","author":"Neary","year":"2007","journal-title":"Rev. Econ. Stud."},{"key":"ref_33","doi-asserted-by":"crossref","first-page":"246","DOI":"10.1287\/orsc.1110.0724","article-title":"When Do Firms Divest Foreign Operations?","volume":"24","author":"Berry","year":"2013","journal-title":"Organ. Sci."},{"key":"ref_34","first-page":"426","article-title":"Growth and Survival of International Joint Ventures: An External-Internal Legitimacy Perspective","volume":"32","author":"Lu","year":"2006","journal-title":"J. Manag."}],"container-title":["Systems"],"original-title":[],"language":"en","link":[{"URL":"https:\/\/www.mdpi.com\/2079-8954\/11\/9\/479\/pdf","content-type":"unspecified","content-version":"vor","intended-application":"similarity-checking"}],"deposited":{"date-parts":[[2025,10,10]],"date-time":"2025-10-10T20:53:22Z","timestamp":1760129602000},"score":1,"resource":{"primary":{"URL":"https:\/\/www.mdpi.com\/2079-8954\/11\/9\/479"}},"subtitle":[],"short-title":[],"issued":{"date-parts":[[2023,9,19]]},"references-count":34,"journal-issue":{"issue":"9","published-online":{"date-parts":[[2023,9]]}},"alternative-id":["systems11090479"],"URL":"https:\/\/doi.org\/10.3390\/systems11090479","relation":{},"ISSN":["2079-8954"],"issn-type":[{"value":"2079-8954","type":"electronic"}],"subject":[],"published":{"date-parts":[[2023,9,19]]}}}