Digital Transformation and Bond Credit Spread

We investigate the impact of enterprise digital transformation on bond credit spread based on Chinese A-share listed companies. The empirical results show that digital transformation has a significant impact on reducing credit spread and the negative relation is robust to a number of robustness checks. Subgroup analyses suggest that the reduction effect is more pronounced in state-owned enterprises, non-duality firms, firms with a higher proportion of independent directors, and firms located in high-marketization areas or eastern regions. Increasing total factor productivity, reducing information asymmetry, and enhancing internal control are three possible mechanisms that digital transformation helps reduce credit spread