Industrial Policy and Firm Performance: A Perspective Based on Intangible Resources

Based on the Resource-Based View (RBV) and Public Choice Theory, this study examines the impact of an industrial policy instrument—the identification of “Time-Honored Brand” (THB) in China—on the performance of businesses. Leveraging the unique context of the Ministry of Commerce’s 2006 re-identification of THBs, this study ingeniously constructs a control group for industrial policy and demonstrates the policy’s effect through data from 974 THB firms. The findings reveal that the identification as a “THB” has a positive impact on the performance of large firms, while negative impact on small enterprises. The study reveals the different effects of the intangible resource given policy among different subjects and confirms the presence of public choice issues in policy implementation.