Transaction Cost Analysis Of Transnational M & A In China

Since 90s of the 20th century to the early 21st century, along with the development of economic globalization, transnational m&a as economic integration of product also gradually became popular in the world。China's reform and opening up policy promoted transnational m&a, the policy of absorbing foreign capital and expanding export, let Multinational companies favor in China which is the best growing market of the emerging markets so that transnational mergers and acquisitions in the Chinese market develop very quickly.But as Chinese enterprises enhance competitiveness in domestic and international market, in the present time, the problem of transnational mergers and acquisitions is not only about the positive and negative effects produced by transnational m&a in China, but also the transnational m&a as an economic analysis, and paying attention for its developing trend.Based on the analysis of multinational companies,the author is trying to explain the reason of the transnational m&a's developing in China with the theoy of transaction cost and draw the conclusion that transnational m&a is an efficient events. But for the transnational m&a purposes, they will not contribute to China's economic boom. About all the problems of transnational m&a in China, the author thinks that the key is the form of industrial structure, the competitive structure or monopoly structure. If it is the competitive market structure, the enterprises's behaviors will be normal and positive for economic development. If it is the market monopoly structure, the monopoly manufacturers will make higher prices and produce lower yields in China, which bring bad effects for the industrial structure. Whether in competitive or monopoly environment, Chinese enterprises are facing the problems of surviving and developing. In the situation of remaining vulnerable in the competition, should use flexible competition strategy, and make efforts to reduce transaction cost. For one point, it will be successful for Chinese enterprises. The Chinese government also make efforts to reduce transaction cost for Chinese enterprisesThe innovation is embodied, in the first, to compete with multinational company, domestic enterprises should strive to reduce transaction cost. To lower transaction costs, Chinese enterprises can not ignore the Chinese way of management, foreign management is not necessarily fit for Chinese enterprises, Chinese management has its advantage. Other documents suggest that the merged companies should follow the advanced foreign management experience, which often cause the merged companies completely controled by multinational companies, so the author thinks that it is not advisable. Second, in dealing with multinational companies, the paper suggests that all domestic enterprises not just the mergered enterprises should reduce transactions cost. Other documents is mainly aimed at the problem of the mergered enterprises and proposed the corresponding countermeasure. The paper does not cover all problems of transnational mergers and acquisitions in China, only focuses on industrial structure, and does not talk about the problem of national economic safety issues, and the transaction cost analysis for national economic security need to be further studied..