M&A and R&D: Asymmetric Effects on Acquirers and Targets?

Florian Szücs

No 1331, Discussion Papers of DIW Berlin from DIW Berlin, German Institute for Economic Research

Abstract: We evaluate the impact of M&A activity on the growth of R&D spending and R&D intensity of 265 acquiring firms and 133 merger targets between 1990 and 2009. We use different matching techniques to construct separate control groups for acquirers and targets and use appropriate difference-in-difference estimation methods to single out the causal effect of mergers on R&D growth and intensity. We find that target firms substantially decrease their R&D efforts after a merger, while the R&D intensity of acquirers drops due to a sharp increase in sales.

Keywords: Mergers; R&D growth; R&D intensity; propensity-score matching; difference in difference estimation (search for similar items in EconPapers)
JEL-codes: D22 G34 O3 (search for similar items in EconPapers)
Pages: 23 p.
Date: 2013
New Economics Papers: this item is included in nep-cfn, nep-com, nep-cse, nep-ind, nep-ino and nep-tid
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Citations: View citations in EconPapers (1)

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Journal Article: M&A and R&D: Asymmetric Effects on acquirers and targets? (2014)
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