ABSTRACT Against the backdrop of the accelerated shift of the manufacturing sector toward sustainable development and the in‐depth advancement of the platform economy, enhancing platform ecosystem embeddedness (PE) holds important practical significance for promoting service‐oriented manufacturing (SOM). This study employs a two‐way fixed effects model to examine the relationship between PE and SOM. The empirical results show that PE exerts a positive influence on SOM. Mediation effect analyses reveal that PE fosters SOM through three mechanisms: optimizing operational efficiency, driving green innovation, and improving capital efficiency. Heterogeneity analysis indicates that strategic embeddedness, model embeddedness, and technological embeddedness exert statistically significant positive effects on SOM, while the effect of application embeddedness is not statistically significant. In addition, in terms of firm, industry, and regional characteristics, the driving effect of PE is more prominent in large‐scale enterprises, enterprises undergoing rapid digital transformation, technology‐intensive industries, regions with a high level of agglomeration of modern service industries, and regions with strict environmental regulations. This study provides empirical evidence on the role of PE in the development of SOM and also provides a reference for policy framework design for China and other emerging economies to advance the manufacturing sector toward achieving SDG 12 and SDG 13 by deepening PE.
Dai et al. (2026) studied this question.