Can the improvement of competitive adequacy and fairness reduce discriminatory M&A behavior? : evidence from the market access negative list pilot in China

Corporate mergers and acquisitions (M&As) are subject to skewed logic due to excessive government regulation. China is progressively adopting the Market Access Negative List (MANL) pilot to transfer the power of resource allocation from the government to the market. Using the DID method, we examine the impact of relaxing market access regulation on firms' M&A behavior against China's institutional background and the M&A events of listed companies from 2012 to 2019. The MANL significantly increases firms' M&A tendency and amount and strengthens the competitive adequacy and fairness of market-oriented M&A decisions. Post-M&A financial performance does not increase, but human capital productivity, innovation effectiveness and total factor productivity do, demonstrating the dynamic balance of profit and efficiency in M&As.