Why do some firms enter a new market by acquiring an existing company operating in this market (external entry), while more than 90% of firms do so by building on their existing resources (internal entry)? This paper shows that human capital acquisition is a key motive behind firms' decision to...

Why do some firms enter a new sector by acquiring an existing company ("buy"), while others do so using their existing resources ("build")? Using a novel dataset constructed by merging French employer payrolls with commercial M&A datasets, we show that firms are more likely to buy when their...