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The State as a Catalyst: How Government-Initiated Social Program Boosts Firm Performance?

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Listed:
  • Wang, Ziqiao
  • Zhang, Wei
  • Hao, Jing
  • Zhang, Xiaotao

Abstract

With the growing complexity of institutional environments, firms strategically develop their social responsibility initiatives to meet the evolving demands of societal and political stakeholders. This study examines the impact of a government-initiated corporate social responsibility (CSR) program on firm performance under the setting of firms’ voluntary participation in the Targeted Poverty Alleviation (TPA) program in China. We find that TPA participation significantly improves firm performance by enhancing social visibility and promoting corporate productivity. Moreover, heterogeneity tests reveal that the impact is more pronounced among firms with weaker social images and greater resource constraints. This study contributes to non-market strategy research by illustrating the beneficial role of aligning CSR concerns with government expectations in securing legitimacy and optimizing resource integration.

Suggested Citation

  • Wang, Ziqiao & Zhang, Wei & Hao, Jing & Zhang, Xiaotao, 2025. "The State as a Catalyst: How Government-Initiated Social Program Boosts Firm Performance?," Economic Analysis and Policy, Elsevier, vol. 87(C), pages 1501-1521.
    • Handle: RePEc:eee:ecanpo:v:87:y:2025:i:c:p:1501-1521
    DOI: 10.1016/j.eap.2025.07.009
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    JEL classification:

    • M14 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Corporate Culture; Diversity; Social Responsibility
    • G14 - Financial Economics - - General Financial Markets - - - Information and Market Efficiency; Event Studies; Insider Trading

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