The Impact of Market Uncertainty on Digital Transformation: Evidence from Chinese Technology Firms with Technological Innovation as a Moderating Variable

The Impact of Market Uncertainty on Digital Transformation: Evidence from Chinese Technology Firms with Technological Innovation as a Moderating Variable | Research Square window.SnipcartSettings = { analytics: { enabled: false } }; (function() { var accessVector = localStorage.getItem('access_vector') || ''; window.dataLayer = window.dataLayer || []; if (accessVector) { window.dataLayer.push({ user: { profile: { profileInfo: { snid: accessVector } } } }); } })(); (function(w,d,s,l,i){w[l]=w[l]||[];w[l].push({'gtm.start':new Date().getTime(),event:'gtm.js'});var f=d.getElementsByTagName(s)[0],j=d.createElement(s),dl=l!='dataLayer'?'&l='+l:'';j.async=true;j.src='https://www.googletagmanager.com/gtm.js?id='+i+dl;f.parentNode.insertBefore(j,f);})(window,document,'script','dataLayer','GTM-K279D39R'); Browse Preprints In Review Journals COVID-19 Preprints AJE Video Bytes Research Tools Research Promotion AJE Professional Editing AJE Rubriq About Preprint Platform In Review Editorial Policies Our Team Advisory Board Help Center Sign In Submit a Preprint Cite Share Download PDF Research Article The Impact of Market Uncertainty on Digital Transformation: Evidence from Chinese Technology Firms with Technological Innovation as a Moderating Variable Jun Cui This is a preprint; it has not been peer reviewed by a journal. https://doi.org/ 10.21203/rs.3.rs-6624217/v1 This work is licensed under a CC BY 4.0 License Status: Posted Version 1 posted You are reading this latest preprint version Abstract This study investigates the relationship between stock market uncertainty and digital transformation initiatives in Chinese technology firms, with technological innovation serving as a potential moderating variable. Using a comprehensive panel dataset of 5,280 firm-year observations from 2016 to 2022, we document a significant negative relationship between market uncertainty and digital transformation investments. However, this relationship is moderated by firms' technological innovation capabilities, where firms with stronger innovation profiles demonstrate greater resilience in maintaining digital transformation initiatives amid market turbulence. Our findings contribute to the growing literature on the determinants of digital transformation and provide practical implications for technology firms operating in volatile market environments. The results are robust to various model specifications, endogeneity concerns, and alternative measures of the key variables. Market uncertainty digital transformation technological innovation Chinese technology firms panel data analysis Full Text Additional Declarations The authors declare no competing interests. Cite Share Download PDF Status: Posted Version 1 posted You are reading this latest preprint version Research Square lets you share your work early, gain feedback from the community, and start making changes to your manuscript prior to peer review in a journal. As a division of Research Square Company, we’re committed to making research communication faster, fairer, and more useful. We do this by developing innovative software and high quality services for the global research community. Our growing team is made up of researchers and industry professionals working together to solve the most critical problems facing scientific publishing. Also discoverable on Platform About Our Team In Review Editorial Policies Advisory Board Help Center Resources Author Services Accessibility API Access RSS feed Manage Cookie Preferences © Research Square 2026 | ISSN 2693-5015 (online) Privacy Policy Terms of Service Do Not Sell My Personal Information {"props":{"pageProps":{"initialData":{"identity":"rs-6624217","acceptedTermsAndConditions":true,"allowDirectSubmit":true,"archivedVersions":[],"articleType":"Research Article","associatedPublications":[],"authors":[{"id":454035964,"identity":"a1da9e41-9c5b-41c2-9971-afc480c6a3af","order_by":0,"name":"Jun Cui","email":"data:image/png;base64,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","orcid":"https://orcid.org/0009-0002-9693-9145","institution":"solbridge international School of Business","correspondingAuthor":true,"prefix":"","firstName":"Jun","middleName":"","lastName":"Cui","suffix":""}],"badges":[],"createdAt":"2025-05-09 02:07:43","currentVersionCode":1,"declarations":{"humanSubjects":false,"vertebrateSubjects":true,"conflictsOfInterestStatement":false,"humanSubjectEthicalGuidelines":false,"humanSubjectConsent":false,"humanSubjectClinicalTrial":false,"humanSubjectCaseReport":false,"vertebrateSubjectEthicalGuidelines":true},"doi":"10.21203/rs.3.rs-6624217/v1","doiUrl":"https://doi.org/10.21203/rs.3.rs-6624217/v1","draftVersion":[],"editorialEvents":[],"editorialNote":"","failedWorkflow":false,"files":[{"id":82483272,"identity":"2cec560c-9471-427f-813d-0224378dda8d","added_by":"auto","created_at":"2025-05-12 04:08:47","extension":"pdf","order_by":1,"title":"","display":"","copyAsset":false,"role":"manuscript-pdf","size":267864,"visible":true,"origin":"","legend":"","description":"","filename":"ESCIScopus3.pdf","url":"https://assets-eu.researchsquare.com/files/rs-6624217/v1_covered_03912c0c-0c9c-4387-8e06-18b3bef7af24.pdf"}],"financialInterests":"The authors declare no competing interests.","formattedTitle":"\u003cp\u003eThe Impact of Market Uncertainty on Digital Transformation: Evidence from Chinese Technology Firms with Technological Innovation as a Moderating Variable\u003c/p\u003e","fulltext":[],"fulltextSource":"","fullText":"","funders":[],"hasAdminPriorityOnWorkflow":false,"hasManuscriptDocX":false,"hasOptedInToPreprint":true,"hasPassedJournalQc":"","hasAnyPriority":true,"hideJournal":true,"highlight":"","institution":"Woosong University","isAcceptedByJournal":false,"isAuthorSuppliedPdf":true,"isDeskRejected":"","isHiddenFromSearch":false,"isInQc":false,"isInWorkflow":false,"isPdf":true,"isPdfUpToDate":true,"isWithdrawnOrRetracted":false,"journal":{"display":true,"email":"[email protected]","identity":"researchsquare","isNatureJournal":false,"hasQc":true,"allowDirectSubmit":true,"externalIdentity":"","sideBox":"","snPcode":"","submissionUrl":"/submission","title":"Research Square","twitterHandle":"researchsquare","acdcEnabled":true,"dfaEnabled":false,"editorialSystem":"","reportingPortfolio":"","inReviewEnabled":false,"inReviewRevisionsEnabled":true},"keywords":"Market uncertainty, digital transformation, technological innovation, Chinese technology firms, panel data analysis","lastPublishedDoi":"10.21203/rs.3.rs-6624217/v1","lastPublishedDoiUrl":"https://doi.org/10.21203/rs.3.rs-6624217/v1","license":{"name":"CC BY 4.0","url":"https://creativecommons.org/licenses/by/4.0/"},"manuscriptAbstract":"\u003cp\u003eThis study investigates the relationship between stock market uncertainty and digital \u0026nbsp;transformation initiatives in Chinese technology firms, with technological innovation serving as a \u0026nbsp;potential moderating variable. 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