International Journal of Performance Measurement







Volume 10, Number 1, June 2020

Corruption and M&A: An Empirical Anlaysis

I-Ting Lee 1 , Wan-Rung Lin 1*, Fu-Ming Lai 1 , Yi-Hsien Wang 1


The financial system in China has been constantly evolving in tandem with economic growth and system development, and M&As have been a frequent occurrence in the financial industry in China over recent years. In the process of forming scale benefits and boosting competitive edges, corruption often increases acquisition costs and affects investors in the market, which cause significant influence on the variables relevant to stock returns. This paper attempts to use the GARCH -based event study method to observe the market reactions to M&As in the Chinese financial market in 2000-2012, and the purpose is to validate whether these reactions are any different under the influence of corruption-related variables. It is intended that the findings based on the comparison of different information values can serve as an important reference to market participants in their decision-making going forward.


Keywords: M&As, Corruption, GARCH-Based Risk Adjusted Model


1 Department of Banking & Finance, Chinese Culture University, Taipei 111, Taiwan

* Corresponding Author, E-mail: