Crisis shocks, executive confidence and strategic change: a study based on US Entity List sanctions

Zhengwei Li, Qiaoli Li () and Yadan Zheng
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Zhengwei Li: Zhejiang University of Technology
Qiaoli Li: Hangzhou Normal University
Yadan Zheng: Zhejiang University of Technology

Humanities and Social Sciences Communications, 2025, vol. 12, issue 1, 1-11

Abstract: Abstract This article examines the influence of crisis shocks on Chinese enterprises' strategic change caused by US Entity List sanctions. We integrate behavioural, prospect and threat rigidity theories to construct an inverted U-shaped relationship model of crisis shocks and strategic change. We then conduct a fixed effects regression using 2016–2022 panel data of A-share listed firms in the computer and communication industries, which are those industries most severely affected by US Entity List sanctions. In addition, we quantify executive confidence via textual analysis techniques and examine the moderating effect of executive confidence on the relationship between crisis shocks and strategic change. The results show that the impact of crisis shocks caused by US Entity List sanctions on strategic change has an inverted U shape; this result implies that moderate crisis shocks promote strategic change but that crisis shocks above a certain level inhibit strategic change. Executive confidence positively moderates the relationship between crisis shocks and strategic change. Further analysis reveals that the impact of crisis shocks on strategic change becomes more significant over time. This study’s findings not only enhance the research on crisis shock and strategic change in the context of US Entity List sanctions but also offer practical strategies for Chinese enterprises to effectively manage the crisis shocks caused by US Entity List sanctions.

Date: 2025
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DOI: 10.1057/s41599-025-05375-w

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