The effects of cross-border acquisitions on firms’ productivity in the EU

Wildmer Daniel Gregori (), Maria Martinez Cillero () and Michela Nardo
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Wildmer Daniel Gregori: European Commission
Maria Martinez Cillero: European Commission
Michela Nardo: European Commission

No 2022.10, Working Papers from International Network for Economic Research - INFER

Abstract: This study empirically investigates the extent to which firms in the European Union, once acquired through a cross-border acquisition, show different productivity levels as compared to those firms that have not been acquired. Our identification strategy relies on the combination of Propensity Scores and the Staggered Difference-in-Difference estimator, using firms’ balance sheet for the years 2008-2018. We find that cross-border acquisitions decrease the productivity of the acquired firms, especially in the manufacturing sector, both high- and low-tech. We find evidence of origin and sector heterogeneity. Firms targeted by acquirers with ultimate owners originating in emerging market economies and Offshore Financial Centres also decrease productivity of target firms in high-tech manufacturing.

Keywords: Cross-border M&As; TFP; European Union; Propensity Score; DiD (search for similar items in EconPapers)
JEL-codes: G (search for similar items in EconPapers)
Pages: 42 pages
Date: 2022
New Economics Papers: this item is included in nep-eec, nep-eff, nep-int and nep-sbm
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Persistent link: https://EconPapers.repec.org/RePEc:inf:wpaper:2022.10

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