Digital platform use and international supplier product performance : an information economics perspective

Abstract

 While the rapid developments of technology have led to the spread of digital platforms, our understanding of their role in the international supply chain environment is still limited. Following an information economics perspective, we investigate how and when the use of digital platforms (i.e., live streaming) enables international suppliers to improve the performance of their products in host markets. By using data of 3,248 product-month observations on one digital platform in China, we find that digital platform use is positively correlated with product performance for international suppliers. Furthermore, this positive effect becomes stronger when legal or cultural distance is greater, and weaker when suppliers have a long exchange history with the platform. These findings provide rich insights into the role of digitalization in operations management.