Timely Policy Exit: Reducing Over-Investment and Driving High-Quality Firm Performance

• Published in: China economist (Beijing, China) Vol. 20; no. 1; pp. 55 - 76
• Main Authors: Hongwei, Dai, Lichen, Zheng
• Format: Journal Article
• Language: English
• Published: Beijing Institute of Industrial Economics, Chinese Academy of Social Sciences 01.01.2025
• Subjects: Competition; Data quality; Efficiency; Expenditures; Industrial policy; Intervention; Investments; Productivity; R&D; Research & development; Research & development expenditures; Social responsibility; Speculation; China

Using data from the 11th to 14th Five-Year Plan periods (2006-2025), this study applies a Difference-in-Differences (DID) approach to assess the impact of industrial policy withdrawal. Industries that have faced policy withdrawal for over a decade are categorized as the treatment group, while consis...