Abstract: Based on China's Ashare listed companies in manufacturing industries from 2012 to 2016, this study examines the influence of technical progress on excessive investment and overcapacity in the perspective of business and industrial properties. The results suggest as follows.Firstly, as far as Chinese manufacturing enterprises are concerned, excessive investment can aggravate overcapacity, while technical progress could significantly reduce it.Secondly, the mediating effect of technical progress applies differently to stateowned enterprises (SOEs) and privateowned enterprises. For privateowned enterprises, excessive investment may restrain corporate technical progress and then worsen corporate overcapacity.But this mediating effect of technical progress does not exist in SOEs.Finally, due to the differences between overcapacity and undercapacity industries in supply and demand relations, the mediating effect of technical progress demonstrates"partial" mediating effect in overcapacity industries while "complete" effect in undercapacity industries.

Key words: technical progress, over capacity, mediating effect, excessive investment