Abstract: Resource recycling is a strategic emerging industry with dual characteristics of quasi publicity and immaturity, and has received strong policy support from Chinese government. However, the policy effect mechanism and comprehensive evaluation have not been paid enough attention. This paper constructs a conceptual model of the influence of policies on the performance of resource recycling enterprise by introducing dynamic sustainability and policy sensitivity. To explore the effective mechanism and transmission paths among different variables, an empirical study was carried out by using structural equation model and regulatory regression analysis based on 312 questionnaires from national urban mineral demonstration bases. Results show that the command-control policies have significant negative effect on the performance of resource recycling, but the economic-incentive policies and the encourage-voluntary policies have significant positive effects. The dynamic sustainability plays a full mediating role between the encourage-voluntary policies and resource recycling performance, while the economic-incentive policy plays a partial mediating effect. Policy sensitivity has significant positive moderating effect both between economic-incentive policies and dynamic sustainability, encourage-voluntary policies and dynamic sustainability. These results reveal the process mechanism of different types of policies affecting the performance of resource recycling enterprises, which will provide important decision-making basis for improving the performance of resource recycling in China.