Does digital transformation, as an important means for firms to gain market competitiveness, reduce the incentives for management tone manipulation? This paper examines the effect of corporate digital transformation on management tone manipulation and its mechanism from the perspectives of psychology and behavioral finance. The results show that the relationship between digital transformation and tone of voice manipulation is inverted ‘U’ shape, with digital transformation increasing the degree of tone of voice manipulation in the early stage and decreasing it in the later stage. The mediation test concludes that digital transformation mainly affects management tone manipulation by influencing the level of information asymmetry and financing constraints. In addition, the effect of digital transformation on management tone manipulation is more pronounced in firms with more myopic management. This paper examines the internal logic of the impact of digital transformation on management tone manipulation from the perspective of management, reveals the ‘double-edged sword’ effect of digital transformation on management tone manipulation, and enriches the literature on digital transformation and management tone manipulation.

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