On M&A Effects

Since 1990s, the fifth M&A tide has surged in the whole world. As a kind of capital operation way, M&A plays an important role in the promotion of the economic development of various countries. The second M&A tide in our country started in 1992, and has been more and more active, and its influence on economy has been stronger and stronger. So to study M&A effects and the influence factors will make a great sense in instructing the M&A development in our country and creating conditions to bring its positive effects into play.There are theory achievements of M&A effects in each discipline. In enterprise theories there are economy of scale, economization of the transaction cost, promotion of efficiency, development of enterprises, settlement of agent problem, market share effect, Hubris and the competition effect and the victor's curse, etc. In financial economics there are underestimation of value, information theory and freedom cash flow theory. In industrial economics there are optimum of industrial organization structure and industrial structure. And the main economical interpretation about M&A effects is optimum of resource allocation. In the study of M&A hi our country, many scholars have studied M&A effects of quoted companies with empirical evidence, and studied the participators' behavior, motives, etc. in M&A, which will give us good inspiration in exploring countermeasures to bring M&A effects into play. Based on these theories, and considering the conditions of the New Economy in which the economy integration of the whole world and information technology develop rapidly, this article will extend the range of M&A effects, studying the M&A effects of intangible resource allocation, a new way in affecting the technology progress and the promotion of economic growth.First this article will introduce the basic knowledge of M&A and the five M&A tides in the whole world in brief, then based mainly on the fifth M&A tide, I will analyze the newest characteristics of M&As. Against the background of these facts, I will review and comment on the M&A effect theories, and extend the range of them. On the basis of these theories, then I will study M&A effects with empirical evidence in the whole world. From the micro aspect I analyze the change of participators' returns. From the macro aspect I analyze the effects of resource allocation, optimum of industrial organization structure and industrial structure, technology progress and economic growth. In the study I summarize three important factors which influence M&A effects. They are management' decision, government's role and efficiency of the capital market. At last, I will analyze the influence of M&A effects on the economic development of our country, and according to the above three factors analvze the obstacles which affect M&A effects in our country, and then explore the countermeasures.