Abstract:    With the wave of a new round of scientific and industrial revolution, digitalization has become an important engine for leading global economic and social changes and promoting high-quality development of China′s economy. This paper focuses on the following questions: Can digital transformation of enterprises improve total factor productivity? If so, what is the mechanism of action? The empirical test on this issue, on the one hand, has provided a new perspective for theoretical researchers to understand the consequences and mechanism of enterprises′ digital transformation; On the other hand, it has also provided unique empirical evidence for practitioners to promote the digital transformation of enterprises and the high-quality development of economy.This paper has taken Shanghai and Shenzhen A-share non-financial listed companies from 2007 to 2019 as research samples, and the study found that: (1) when enterprises pay more attention to digitization, their total factor productivity will be improved significantly. The results remained robust after the test of instrumental variable method, propensity score matching and substitution variable. (2) The heterogeneity test found that the information collection and processing advantages of data production factors can help enterprises with farther distances from suppliers and customers and enterprises with higher business complexity to improve the efficiency of resource allocation. In addition, when the enterprise is a growing one or a small and medium-sized one, strengthening the construction of its own digitization level is more conducive to improve its total factor productivity. (3) The mechanism test found that the digital transformation of enterprises improves the total factor productivity by improving investment efficiency, reducing external transaction costs, expanding customer resources and increasing innovation ability. (4) The economic consequence test found that when the total factor productivity of enterprises increases with the digital transformation, it can help enterprises improve their competitive position.The possible theoretical contribution and practical significance of this paper are as follows: firstly, this paper has enriched the relevant research on the consequences of digital transformation. The existing literature mainly studies the impact of digital transformation on the survival and development of traditional industries, internal organizational change and enterprise investment. There is still no empirical discussion on how digital transformation affects the resource allocation efficiency and even the competitive position of non-financial enterprises. This paper found that enterprise digitization does improve the efficiency of enterprise resource allocation, and will eventually help enterprises obtain competitive advantage, which provides a new perspective for academia to understand the value creation results of digitization. Secondly, this paper tested and found the path of digitization on the efficiency of enterprise resource allocation from four ways: investment efficiency, transaction cost, customer channel and innovation ability, which provides a new perspective and verified basis for the theoretical and practical circles to understand the mechanism of digital transformation. Thirdly, this paper introduced four scenarios: the distance between enterprises and suppliers and customers, business complexity, enterprise size and growth. On the one hand, it verified that the information collection and processing advantages of data production factors can promote enterprises to improve the efficiency of resource allocation. On the other hand, it found that digitization is an important support for small and medium-sized enterprises or growing enterprises to shape their competitive advantage.This paper has the following important policy suggestions and implications: firstly, this paper proves the driving effect of digital transformation on enterprise total factor productivity through empirical evidence, indicating that the advantages of enterprise digital transformation outweigh the disadvantages, which is consistent with the policy guidance direction in the era of digital economy. Government should continue to facilitate the integration of digital technology with the real economy, guide and support enterprises to empower traditional industries with information technology. Secondly, for enterprises that are far away from suppliers and customers and face information asymmetry with upstream and downstream members of the supply chain, as well as enterprises with high business complexity, they should make full use of information collection and processing advantages of emerging information technology to realize optimal allocation of resources. For growing enterprises and small and medium-sized enterprises, they should realize that digitalization plays a stronger role in optimizing the efficiency of resource allocation, and actively participate in and realize digital transformation. Finally, in the process of digital transformation, enterprises should focus on using digital and internet platforms to gain insight into market information and explore investment opportunities, reduce external transaction costs by using the characteristics of digital technology, accurately identify the diversified needs of customers and expand their own customer resources when efficiently dealing with massive data information, and strengthen the innovation driving role of digital change.

Key words: digital transformation, total factor productivity, external transaction cost, innovation ability, investment efficiency, competitive position