Empirical Research Of Industrial Cycle,Government Intervention And M&A Performance

In the process of enterprise growth. M&A has been an important method to improve enterprise and allocate resource. The history of M&A in market economy country is more than100years, but less than30years in China. Government intervention with Chinese characteristics emerges because of the imperfect M&A law. During government transition in our country, government function is more complex and uncertain than which in developed countries. To conclude, it’s significant to research the corporation M&A performance and industrial cycle under government intervention and background of industry consolidation.Adopting the method of theory and evidence, this article put forward the hypotheses on corporation M&A performance under government intervention in different industrial cycle. Using a sample of local state-owned listed M&A target firms from2005to2008, we examine the effect of government intervention and different industrial cycle on target firms with regression testing. We find that the M&A performance will be deteriorative in growing industry and concentrated industry under government intervention, but improved in technological change industry and declining industry. Meanwhile we confirm the positive correlation relationship of industrial concentration and industry performance. These conclusions will supply reference and idea to local government policy and economic transition.This article is divided into five parts altogether. The first part is introduction which recommends the background and meaning of the research. The second is summary on correlation theories, which about industrial cycle and government intervention in order to introduce the relative variables. Third is the study hypothesis and research design. To propose the hypothesis, we analyze the relationships between industrial cycle and corporation M&A. as well as government intervention and corporation M&A. Research design includes the selection of the sample and variable, the distinction of industrial cycle, establishment of the model. The forth part is the result and analysis. We analyze different samples and prove the hypotheses in this part. In the end we summarize the full-text and present the problem we haven’t solved.