The harm of overcapacity is great, mainly manifested in: occupying a large amount of development resources without producing economic benefits; allowing the economic system to continue to deposit resources; possibly causing systemic and large-scale financial crises; and destroying the industrial ecosystem. Mitigating and preventing overcapacity has a great effect on the transformation and upgrading of China's economy. Under the new normal of the economy, we need to use competition policies to resolve overcapacity and reduce ineffective and low-end supply in the industry. It must be particularly pointed out that the main body of the structural adjustment in the industrial organizations is enterprises and entrepreneurs, not government officials.Dr. Cheng Junjie’s new book "Measurement, Causes and Effects of Overcapacity in China's Transition Period" has high academic value. The main features include: firstly, in theory, the book constructs a framework to summarize the causes of overcapacity in China's transition period as "entry and exit control" based on government intervention; secondly, in terms of methods, a large number of empirical analyses have been carried out in depth to provide a reference for the quantitative measurement of domestic overcapacity; thirdly, in the argument, after rigorous derivation and analysis, the book puts forward a series of relatively novel viewpoints.
