After experiencing long-term high-speed growth, the Chinese economy has accumulated huge social wealth and built a solid foundation for economic development. However, it also needs to systematically sort out, deeply reflect on, and optimize the original growth path. In fact, the relationship between stock and increment is essentially a philosophical proposition, and in the context of economics, it becomes concrete and pragmatic, involving the efficiency of resource allocation in reality. In the past, China's economic development mainly relied on incremental expansion to adjust industrial structure and drive economic growth. Currently, we have transitioned to a new stage of "coexistence of stock game and incremental optimization". The stock part needs to achieve resource restructuring and efficiency improvement through game theory, while the incremental part needs to explore new development space through optimized layout, quality improvement, and efficiency enhancement. Therefore, how to correctly handle the relationship between stock adjustment and optimizing increment has become a major economic proposition that we must attach importance to and solve from a higher and deeper perspective. Overcoming path dependence and constructing a new resource allocation mode centered on stock adjustment. For a long time, the development path and thinking mode centered on incremental reform and supply side efforts have promoted economic growth, but this advantage has also formed path dependence. In the context of sufficient incremental space in the past, the idea of incremental development can effectively balance the interests of all parties and maintain the stability of the original interest pattern, but it also leads to slow progress and significant resistance in stock adjustment. From the perspective of reforming the distribution of interests, whether it is stock adjustment or incremental creation, it essentially involves the readjustment of interest relationships, which will inevitably trigger and change the original pattern of interests. In the past, the key to our ability to effectively alleviate this contradiction and reduce resistance to reform was that there was ample room for incremental development at that time. By continuously creating new economic growth, we were able to effectively resolve social frictions and reduce reform costs. This approach of prioritizing the expansion of the cake and avoiding or alleviating existing conflicts of interest by exploring incremental growth is a unique development advantage in China's reform process. However, over time, this has also led to relatively lagging stock adjustment work, increased difficulty in promotion, and formed a thinking inertia that policy formulation and implementation tend to solve development problems by exploring new growth areas, rather than directly touching on stock resources with complex interests and difficult adjustment. At present, the scale of China's stock is already huge, and the problem of supply-demand contradiction is becoming increasingly prominent. At the same time, influenced by multiple factors such as severe and complex international and domestic situations, and changes in economic cycles, the economy is showing characteristics of slowing growth rate and reduced traditional growth opportunities. Therefore, it is necessary to establish a new understanding of development and shift towards a new approach that combines stock adjustment with incremental optimization. In the past, we have mature experience and practices on how to develop increment, and optimizing increment is more of a practical issue rather than a conceptual issue. However, in terms of stock adjustment, both experience accumulation and social consensus are still the key weaknesses that need to be broken through at present. The primary task is to overcome path dependence in understanding and strengthen the determination to promote stock adjustment. This is a major challenge that governments at all levels and entrepreneurs must face. Focusing on revitalizing and adjusting existing stocks, and strengthening policy regulation, China has accumulated huge social wealth through long-term high-speed growth, while also forming a considerable amount of accumulated resources and stagnant assets. How to effectively activate these existing resources has become the key to unleashing development potential and improving allocation efficiency. The essence of asset revitalization is a profound adjustment of existing interest relationships, which involves complex ownership structures and production relations. To promote this work, it is necessary to properly balance the interests of multiple parties. With the iteration and upgrading of technology, the transformation of consumption patterns, and the widespread penetration of new technologies, traditional industries are facing enormous challenges in production and operation. This situation exists not only in the manufacturing industry, but also in service industries such as catering. Even some relatively emerging industries, such as new energy, have encountered overcapacity due to excessive investment over a period of time. In the context of increasingly fierce market competition, enterprises are prone to vicious competition in order to survive. They first compete on prices, then compress costs, and ultimately affect the quality of products and services. If effective measures are not taken to regulate it, this vicious competition will form a negative spiral, which not only leads to a decline in product and service quality, but also has a negative impact on wage levels and residents' income, thereby damaging the overall social benefits. The adjustment of industrial stock must adhere to anti internal competition, regulate industry competition order, and mergers and acquisitions are important levers. Further improvement of the Enterprise Bankruptcy Law is needed. We should fully leverage the leading role of advantageous enterprises, integrate industry resources through mergers and acquisitions, let advantageous enterprises lead the development of the industry, promote the orderly exit of backward production capacity and disadvantaged enterprises from the market, and achieve industrial quality and efficiency improvement. Although China's enterprise bankruptcy law has been continuously improved in recent years, compared with mature market economy countries, the enforcement strength is still insufficient. The core problem is that we often attribute economic problems to the need to maintain stability, which adds too many non economic factors to conventional economic work. In fact, it is a normal law of the market economy for disadvantaged enterprises to exit the market in accordance with the law. Only in this way can we free up space for the development of new enterprises and promote the overall quality improvement of the industry. The supply side remains an important foundation for economic development, and it is not necessary to weaken supply, but to reasonably control the excess total supply, while expanding total demand, further promoting the "three pillars" to shift from investment led to consumption driven, focusing on the livelihood sector, and increasing investment in people. Multiple studies have shown that increasing investment in areas related to people's livelihoods and residents' consumption ability yields far greater benefits than pure supply side investment. Of course, this requires us to break the policy inertia and mindset formed during the period of high-speed growth, further emancipate our minds, and optimize policy guidance. From the perspective of overall planning from both supply and demand sides, significant results have been achieved in optimizing the incremental supply side. The high-tech industry is a prominent highlight, and in the future, it is necessary to further consolidate its advantages and do a good job in identifying and screening incremental development. In recent years, China's high-quality development has been solidly implemented, achieving breakthroughs in many technological fields, especially in the years after the epidemic. Significant achievements have been made, not only filling some of the gaps in traditional industries, but also making important progress in cutting-edge fields such as artificial intelligence and biotechnology. Emerging industries such as new energy have formed a global industrial advantage, and even in the face of temporary overcapacity, they have established a global leading position in terms of technology. The key to achieving excellence in incremental development lies in 'excellence', which requires us to carefully identify and scientifically choose the direction of future incremental development. From the perspective of demand side expansion, it is necessary to not only deeply cultivate the domestic market, but also seize the window period of overseas layout. "Going global" is an important opportunity and historical trend for enterprises. From a macro perspective, China has grown from a capital shortage stage to an important capital exporting country. Referring to international experience, when a country reaches a certain stage of development, domestic consumer demand will be difficult to fully digest production capacity, and relying solely on commodity exports will also be unsustainable. Therefore, promoting green space investment and overseas layout of capital and industries is an inevitable choice. At present, China is entering a critical window period of transformation: on the one hand, there has been an excess of capital domestically, which provides objective conditions for capital output; On the other hand, a new wave of global industrial transfer has arrived, which includes both the transfer of traditional backward production capacity and the layout adjustment of advanced production capacity. Although this process is accompanied by challenges, it is also a significant strategic opportunity, and many countries have a positive welcome attitude towards Chinese companies investing and layout locally. The organic combination of revitalizing stock and optimizing increment is not separated from each other, but dialectically unified and complementary. From a dialectical perspective, optimizing increment and revitalizing stock complement each other. We should use optimizing increment to drive stock adjustment, while relying on existing stock resources to provide support for incremental development. The current social resources are mainly concentrated in the existing areas. Only by promoting a positive interaction and mutual promotion between the two can efficient allocation of resources be achieved. Enterprises can also consider their own development based on the above ideas. At present, it is not advisable for enterprises to blindly adopt leapfrog expansion in their development. Instead, they should base themselves on their existing foundation, rely on their advantages in capital, technology, and market, and accurately explore new growth opportunities. At the policy level, it is necessary to increase policy tilt in the financial sector, provide precise support to enterprises in listing, financing, and other aspects, and create a favorable environment for revitalizing and increasing the stock of enterprises. Overall, revitalizing the stock and optimizing the increment must be planned in the overall context of comprehensively deepening reform, fully leveraging the decisive role of the market in resource allocation, relying on the market competition mechanism of survival of the fittest, and building a new development pattern that deeply integrates the stock and increment, continuously improves efficiency, and enhances competitiveness. Authors: Mao Zhenhua (Co Director, Professor, and Doctoral Supervisor of the Institute of Economics at Renmin University of China), Liu Yujie (Doctoral Student at the School of Economics, Renmin University of China)