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How the negative list system affect enterprises' overseas merger and acquisition?

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  • Yang, Liguo
  • Liu, Yuna

Abstract

This paper examines how China's negative list system for market access alters corporate cross-border merger and acquisition (M&A) plans, providing new insights into the relationship between regulatory reforms and global business expansion. Utilizing data from 2012 to 2023, the analysis demonstrates that the negative list system substantially increases the likelihood and incidence of foreign acquisitions by diminishing institutional uncertainty and readjusting firms' risk-reward paradigms. Empirical evidence indicates that the policy functions through two mechanisms—heightening domestic competitive pressures and eliminating organizational complacency—thus converting cross-border M&A from optional activities into strategic necessities for maintaining competitiveness. The results emphasize the system's function in synchronizing corporate conduct with market-driven incentives, especially for younger, resource-abundant enterprises operating in liberalized industries. This research offers practical insights for policymakers to enhance market-access frameworks and for companies to implement adaptive globalization strategies. The report finally identifies the negative list as a catalyst for reframing China's participation in global value chains, balancing competitive neutrality with strategic internationalization.

Suggested Citation

  • Yang, Liguo & Liu, Yuna, 2025. "How the negative list system affect enterprises' overseas merger and acquisition?," Finance Research Letters, Elsevier, vol. 85(PC).
    • Handle: RePEc:eee:finlet:v:85:y:2025:i:pc:s154461232501342x
    DOI: 10.1016/j.frl.2025.108085
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    References listed on IDEAS

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    1. Li, Ni & Yu, Bichen & Wu, Jinlong & Kuang, Yingxu & Kong, Dongmin, 2025. "Strategic embeddedness in supply chains: Network position and corporate M&A decisions," Finance Research Letters, Elsevier, vol. 86(PF).

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