Maturity mismatch and disinvestment as transmission mechanisms: Linking economic policy uncertainty to firm performance

Since the beginning of the 21st century, the global economic and political landscape has become ever-changing, leading to rising economic policy uncertainty (EPU) in China. Utilizing indicators of macro EPU and firm perception of EPU, this study analyzes panel data from Chinese A-share listed firms (2007–2022) to investigate how EPU affects firm performance. The research findings demonstrate that EPU negatively affects firm performance primarily through maturity mismatch and disinvestment. Macro-level economic policy uncertainty shapes micro-level firm perceptions and strategic responses. Furthermore, the negative impact of EPU is more pronounced for firms operating in highly concentrated industries, as well as for risk-preferred firms, non-SOEs, cross-border firms during periods of Sino–US trade friction, and decline-stage firms. Lastly, this study recommends that government agencies prioritize continuity, predictability, and transparency in implementation of economic policies. To build resilience when EPU is rising, firms should leverage information-driven strategy, optimize debt–asset structure, and enhance competitiveness.