Economic policy uncertainty and enterprise strategic change: Evidence from China

A consensus in the field of strategic management is that the external environment plays a role in shaping corporate strategy. However, as an important part of the enterprise's external environment, the relationship between economic policy uncertainty and enterprise strategic change has not received due attention. Based on real options theory, principal-agent theory, and resource-based view (RBV), this paper empirically analyzes the impact of economic policy uncertainty on enterprise strategic change by taking A-share listed companies in the Shanghai and Shenzhen stock exchanges from 2002 to 2020 as research samples, as well as the moderating roles of precipitation organizational slack and ownership property. The authors found that economic policy uncertainty has a restraining effect on enterprise strategic change. When economic policy uncertainty is higher, enterprises will stop and wait, and be less inclined to initiate strategic change. Precipitation organizational slack negatively moderates the relationship between economic policy uncertainty and enterprise strategic change. When enterprises have more precipitation organizational slack, it will further enhance the inhibition of economic policy uncertainty on enterprise strategic change. Ownership property positively moderates the relationship between economic policy uncertainty and enterprise strategic change. When the enterprise is a state-owned enterprise, it will further weaken the inhibition effect of economic policy uncertainty on enterprise strategic change.