The impact of policy validity on resource misallocation in the cultural industry: evidence from China

With the deepening of economic globalization, the efficiency of resource allocation in the cultural industry has increasingly become a critical determinant of national competitiveness, and policy interventions exhibit dual effects in this process. In this study, we examine the cultural industry policies issued by Chinese central government agencies and ministries from 2014 to 2023 and categorize them into three types: regulatory policy, trade policy, and fiscal incentives. Descriptive statistics reveal persistent distortions in factor markets, with mean values for capital misallocation and labor misallocation at 0.1705 and 0.2014, respectively. Empirical results indicate that policy validity has a significant effect on resource allocation, though the impacts vary by policy type: regulatory policies with a coefficient of 0.0320 and fiscal incentives with a coefficient of 0.0346 exacerbate capital misallocation, whereas trade policies with a coefficient of −0.0200 mitigate it. In the labor dimension, regulatory policies and fiscal incentives, with coefficients of −0.0100 and −0.0760 respectively, alleviate labor misallocation, while trade policies with a coefficient of 0.1520 intensify it. Furthermore, from the perspective of policy coordination, the synergistic outcomes vary across different policy instruments. The coordination potential of regulatory policies is primarily concentrated in the labor dimension, whereas trade policies and fiscal incentives exhibit a stronger coordination advantage in optimizing capital allocation. The research conclusions not only provide theoretical and empirical evidence for achieving Pareto improvement in resource allocation but also offer specific policy recommendations for governments to refine policy design and correct factor market failures.