Revolutionizing Chinese Manufacturing: Uncovering the Nexus of Intelligent Transformation and Capital Market Information Efficiency

Abstract

Intelligent transformation plays a crucial role in advancing sustainable development in manufacturing while also enhancing the information environment. This study examines the role of intelligent transformation in China’s manufacturing sector, spanning theoretical and empirical dimensions and being anchored in the context of capital market information efficiency. The theoretical framework highlights how intelligent transformation mitigates information asymmetry, aligning a firm’s valuation with its intrinsic value, thereby elevating the information efficiency of capital markets. Leveraging annual reports from China’s A-share manufacturing firms, this study employs textual analysis to construct indicators assessing the extent of intelligent transformation across these entities. The empirical findings of this study harmonize with the theoretical constructs. Notably, intelligent transformation emerges as a pivotal driver in enhancing information efficiency in capital markets, substantiated by a negative correlation between intelligent transformation and stock price synchronicity within the manufacturing domain. This correlation withstands a battery of robustness tests and endogeneity treatment. The mechanism driving this transformative impact lies in intelligent transformation’s ability to enhance productivity and magnify market attention, thereby positively influencing capital market information efficiency. The insights not only provide empirical support but also offer practical guidance for improving real-world company operations and developing high-quality capital markets.