An empirical analysis on the dynamic relationship between the scale of market for corporate control and economical factors -Taking American market for corporate control (1970–1999) as an example

Abstract

Researches on market for corporate control mainly focused on achievements of involved enterprises around the merge-time. Literature in domestic and foreign mainly stress microscopic stratification. They seldom mentioned the macroscopic economical factor. This article makes an empirical analysis on the dynamic relationship between the scale of market for corporate control(SMCC)and economical factor by time-varying parameter model in the macroscopic view completely. Meanwhile, we established Vector Auto-Regression (VAR)model between SMCC and its influencing factors. The aim is to analyze further the transfer effect on SMCC by the impacts of economical influencing factors. We also researched the influence characteristics accused by economical factors on SMCC. The result shows that there is co-integration relation among SMCC and its influencing factors. Compared with the degree of impulse responses of SMCC to its influencing factors respectively, new-added investment (NAI) shows the most significant effect on SMCC during a long time period. The second is the impact from capital market(CM) with a longest time. Impulse on gross domestic product (GDP) shows almost same effect with CM. Impulse responses of SMCC to company income-tax (CIT) is weakest with short time.