Under the dual strategic background of Yangtze River Delta regional integration and digital transformation of manufacturing industry, this paper firstly constructs an evaluation system from the three dimensions of the level of digital economy development, digitalization of manufacturing inputs, and the level of comprehensive transformation, and applies the entropy method and the comprehensive index method to measure the capability of digital transformation of the manufacturing industry of the Yangtze River Delta from 2015 to 2024. Through the panel fixed effect model and mediation effect model to verify the influence mechanism of digital economy on the transformation and upgrading of manufacturing industry, it is found that digital economy promotes the transformation through the dual path of optimizing resource allocation and promoting regional innovation. Benchmark regression shows that the core explanatory variables of digital economy pass the significance test at 1% confidence interval, and the regression coefficients are positive. For every 1-unit increase in the level of digital economy development, the comprehensive score of manufacturing transformation and upgrading increases by 0.298 units. In the mediation effect, the estimated coefficients of the level of digital economy development on different models are 205.47, 0.169, -50.29, 0.627, respectively, which passed the significance test at 1% level. Combined with the results of the study, corresponding transformation paths and digital divide elimination strategies are proposed.
