Location Choices of Multinational Firms: The Case of Mergers and Acquisitions
Location Choices of Multinational Firms: The Case of Mergers and Acquisitions
- 세종대학교 경제통합연구소
- Journal of Economic Integration
- 제22권 제1호
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2007.03181 - 209 (29 pages)
- 2

This article examines the location choices of cross-border Mergers and Acquisitions (M&A) between OECD members` firms in the 1990`s. In addition to traditional determinants of FDI, we estimate the impact of specific factors affecting the M&A location pattern. Two distinct econometric methods are implemented: the conditional logit and the count model. We find that the supply of target firms constrains the location of M&A. However, it is not the only determinant of location: the market size, the labor cost, the market access and the financial openness play a positive and significant role in the M&A location. A bandwagon effect is also observed. In the opposite, the corporate tax rate and the productivity decrease the probability to attract M&A. Cultural and geographic distances as well as differences in legal rules exert a negative significant impact on M&A strategies too. Only the ownership structure has contrasted results.
Ⅰ. Introduction
Ⅱ. The Econometric Model: Location Choices
Ⅲ. Description of Variables and their Expected Effects
Ⅳ. Empirical results and interpretations
Ⅴ. Conclusion
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