This paper explores the mechanism of market access, tax incentives, government subsidies, and bank credit industrial policies on the efficiency of enterprise investment based on the perspective of market forces and government support. The industrial policy of lowering market access intensifies market competition, which shifts the market share from inefficient enterprises to more efficient ones and increases the efficiency of enterprise investment; the industrial policy of tax incentives increases the profit margin between the price of production factors and the selling price of commodities, which increases the return of enterprise investment and increases the efficiency of investment accordingly; the industrial policy of government subsidies distorts the price of resource factors and leads to overcapacity, which decreases the efficiency of enterprise investment; the industrial policy of bank credit, where credit resources are used to support and encourage enterprises to invest. The government's subsidized industrial policy will distort the price of resource factors, leading to overcapacity and lowering the efficiency of enterprise investment; bank credit industrial policy, credit resources used to support encouraging industries will raise the financing cost of other industries in disguise and reduce the efficiency of enterprise investment.

Chen Yanfang, Zhou Fuping. The Influence Mechanism of Industrial Policy on Enterprise Investment Efficiency—Based on Market Competition and Government Support Perspective. Academic Journal of Business & Management (2022) Vol. 4, Issue 12: 48-53. https://doi.org/10.25236/AJBM.2022.041209.

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