Cross-border mergers and acquisitions and the role of trade costs
Cross-border mergers and acquisitions (M&As) have increased dramatically over the last two decades. This paper analyses the role of trade costs in explaining the increase in the number of cross-border M&As. In particular, we distinguish horizontal and non-horizontal M&As and investigate whether trade costs affect these two types of mergers differently. We analyse this question using industry data for 23 OECD countries for the period 1990-2001. Our findings suggest that while in the aggregate trade costs affect cross-border merger activity negatively its impact differs importantly across horizontal and non-horizontal mergers. The impact of trade costs is less negative for horizontal mergers, which is consistent with the tariff-jumping argument.
Year of publication: |
2008
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Authors: | Hijzen, Alexander ; Görg, Holger ; Manchin, Miriam |
Published in: |
European Economic Review. - Elsevier, ISSN 0014-2921. - Vol. 52.2008, 5, p. 849-866
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Publisher: |
Elsevier |
Saved in:
Online Resource
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