Digital tax systems and innovation in textile manufacturing
Source abstract
Abstract
Abstract China’s textile industry faces critical transformation pressures transitioning from labor-intensive to technology-driven manufacturing. This study examines how digital tax administration systems influence innovation capabilities in textile enterprises, utilizing China’s Golden Tax Phase III project staggered implementation as a quasi-natural experiment. Analyzing 4,250 observations from Chinese listed textile companies (2008–2018) through difference-in-differences methodology, we investigate digital governance impacts on textile innovation outcomes. Results demonstrate that digital tax administration significantly enhances textile enterprise innovation capabilities, increasing invention patent applications by 13.4%. The mechanism analysis reveals that digitalized systems suppress earnings management behaviors, compelling textile manufacturers to redirect resources from financial manipulation toward substantive innovation investments in textile technologies and processes. Heterogeneity analysis shows pronounced effects for enterprises with high agency costs and advanced digital transformation levels. This research provides crucial evidence for understanding how digital governance frameworks can catalyze innovation transformation in traditional textile manufacturing, offering policy insights for promoting technology-driven development in China’s textile sector. The findings suggest that digital administrative reforms create positive externalities for textile industry innovation upgrading and international competitiveness enhancement.
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Research context
OpenAlex topics: Corporate Taxation and Avoidance · Taxation and Compliance Studies
SciVX discovery tags are terminology-based. OpenAlex topics are source-provided classifications.
Affiliations
School of Economics and Trade, Guangzhou Xinhua University , Guangzhou , 510520 , China
School of Management, Shanghai University , Shanghai , 200444 , China
References (27)
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