From the Collaborative Bond and Money Market Data Portal
'Anti-involution' refers to policy or a set of measures taken to combat involution. As involution is also described as 'irrational' or 'destructive competition' which occurs when there is intense competition without returns on profitability, anti-involution is often implemented in these kinds of cases. Examples of anti-involution policy include, but are not limited to:
- Legislative revisions: amending pricing laws to prevent companies from selling below production costs (at a loss)
- Corporate restructuring: within firms, this could include the implementation of downsizing, or increasing M&A to reduce overcapacity
- Competition correction: regulatory bodies can consolidate smaller firms into fewer larger ones, or break up the large firms engaging in the involution.
- Increasing oversight: Enhancing regulatory oversight in specific sectors or economy-wide
- Curbing outdated capacity: encouraging producers with excess capacity to unload, or closing uncompetitive or outdated facilities