China’s National Artificial Intelligence Strategy, Firm Adoption, and Short-Run Performance Effects

Cheng Peng Cheong ()
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Cheng Peng Cheong: Peking University, Guanghua School of Management

A chapter in Proceedings of the 2026 11th International Conference on Social Sciences and Economic Development (ICSSED 2026), 2026, pp 397-404 from Springer

Abstract: Abstract Artificial Intelligence (AI) is becoming increasingly important in firms’ performances. This paper examines how China’s 2017 national AI strategy affects firm-level AI adoption and its short-run performance implications. This study constructs AI adoption intensity by counting AI-related words using A-shared list firms within the time period 2001 to 2024. A two-way fixed effects model is introduced to study the relationship between degree of adopting AI and degree of how firms performed. Results are that the initiative is effective in incentivizing more AI adoption, but more adoption in AI does not mean better financial performance of firms at least in the short-run. It is found that there is a negative association between AI adoption and firm performances. Heterogeneity and moderating analyses are further conducted to explore the relationship under different firms’ characteristics. The findings contribute to the literature on the area of influences of China’s AI initiative on corporate AI adoption and its subsequent impact. Future researches could focus on mechanism analysis.

Keywords: Artificial Intelligence (AI); Industrial Policy; Firm Performance; AI Adoption (search for similar items in EconPapers)
Date: 2026
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Persistent link: https://EconPapers.repec.org/RePEc:spr:advbcp:978-94-6239-701-9_41

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DOI: 10.2991/978-94-6239-701-9_41

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