The Impact of Anti-Involution Strategies on Corporate Performance: An Empirical Analysis Based on Listed Manufacturing Firms in China
DOI: https://doi.org/10.62517/jbm.202509620
Author(s)
Xihan Wang
Affiliation(s)
Renmin University of China, Suzhou Industrial Park, Jiangsu, China
Abstract
Under the situation of an over-supply market and the industrial economy, Chinese manufacturing enterprises are playing an increasingly suffocating rapid involution competition. Using panel data on China A-share listed manufacturing companies from 2012 to 2024, this paper empirically studies the effect and internal mechanism of the anti-involution strategy on corporate performance. The empirical findings are as follows: (1) The short-run effect of anti-involution strategy on corporate performance is significantly negative, with a comprehensive coefficient of -0.833 (P < 0.01), which reflects the immediate cost burdening effects of differentiated investment; (2) Competitive intensity has a positive moderating role between anti-involution strategy and corporate performance, with an interaction coefficient of 0.156(P < 0.01), illustrating the significance that competitive factors have in weakening the negative consequences generated by adopting an anti-involution strategy under highly competitive conditions; and (3 ) The heterogeneity analysis suggests that the impact of anti- involution strategies differs for different levels of competition and firm size. Drawing on the framework of anti-involution strategy and drawing lessons from sociologically inspired works, this study has recognized “dual effects” regarding such strategies in a context-consistent manner-the short-term “cost pressure” versus long-term “defensive value”-to help interpret strategic choices among Chinese manufacturing enterprises. The results provide several important implications for both corporate and industrial policymaking: on the one hand, firms need to carefully conduct anti-involution strategies with respect to their competitive environment; on the other, policymakers should understand an internal equilibrium emerging between the short-term costs and long-run benefits of promoting differentiation.
Keywords
Anti-Involution Strategy; Corporate Performance; Competitive Intensity; Differentiation Strategy; Chinese Manufacturing Industry
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