 Corporate governance and merger and acquisition (M&A) FDI: Firm-level evidence from Japanese FDI into the USJoseph Alba, Donghyun Park and Peiming Wang Journal of Multinational Financial Management, 2009, vol. 19, issue 1, 1-11 Abstract: Merger and acquisition (M&A) is a mechanism for promoting corporate governance. This suggests that an improvement in overall corporate governance may have a negative effect on M&A activity. Since M&A foreign direct investment (FDI) is a cross-border variant of M&A, we use firm-level data to investigate the effect of US corporate governance on Japanese M&A FDI. Our results indicate that two landmark corporate governance regulations by the US Securities and Exchange Commission (SEC) in 1992 contributed significantly to the sharp decline in Japanese M&A FDI in the US during the 1990s. Our evidence lends some support to the notion that corporate governance may affect not only domestic M&A activity but also cross-border M&A activity. Our study also sheds some light on the puzzle of why Japanese FDI into the US fell during the 1990s despite the depreciation of the US dollar. Keywords: Corporate; governance; Merger; and; acquisition; Foreign; direct; investment (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:mulfin:v:19:y:2009:i:1:p:1-11 Access Statistics for this article Journal of Multinational Financial Management is currently edited by I. Mathur and G. G. Booth More articles in Journal of Multinational Financial Management from Elsevier |
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