An Empirical Analysis Of The Influence Of Cross-border Mergers And Acquisitions On Total Factor Productivity

Total factor productivity can be affected by four factors: knowledge progress, allocation of resources, economies of scale and institutional changes. It can be decomposed into technical efficiency and technological progress, while technical efficiency can be further decomposed into pure technical efficiency and scale of efficiency. Cross-border M & As indirectly affects total factor productivity and its decomposition through the above four factors. The effect can be positive, and can also be negative. Using Malmquist Index method of Data Envelopment Analysis, it estimates the total factor productivity and its decomposition of chemistry, medicine, machinery and electronic communications industry from 1995 to 2004. It shows that the total factor productivity increases in a different degree except machinery industry. There is technological progress, but the technical efficiency and pure technical efficiency have not been improved. The improvement of total factor productivity mainly relies on the technological progress, and there is still large room for the improvement of technical efficiency and pure technical efficiency. Adding the explanation variables of domestic R & D and human capital, it constructs a panel data model of the impact of cross-border M & As on the total factor productivity and its decomposition. The empirical study shows that cross-border M & As is conducive to the improvement of total factor productivity, technical efficiency and scale of efficiency, and promotes the technological progress, but not conducive to the improvement of pure technical efficiency. The effect of cross-border M & As to the total factor productivity is mainly demonstrated through the promotion of technological progress. Compared with the domestic R & D, the improvement of cross-border M & As to the total factor productivity is greater than the domestic R & D, while the improvement of cross-border M & As to the technological progress is less than the domestic R & D. Cross-border M & As can be an important way to promote total factor productivity in a short term, but in a long term the increase of the total factor productivity relies on our own technological progress. Therefore, in the wave of cross-border M & As, China should effectively make use of cross-border M & As, advance enterprise management and enhance the capability of independent innovation to improve total factor productivity.