Mergers along the Global Supply Chain: Information Technologies and Routineness

Sergi Basco and Martí Mestieri

No 13-428, TSE Working Papers from Toulouse School of Economics (TSE)

Abstract: This paper empirically analyzes how the adoption of Information Technologies (IT) has changed the organization of global supply chains. We focus on international mergers, which are a growing and important component of foreign direct investment. We use data on North-South vertical mergers and acquisitions for all manufacturing industries. We show that the effect of IT adoption on the number of vertical mergers and acquisitions is decreasing with the “routineness” of the industry. Our interpretation is that the IT revolution has enabled new monitoring mechanisms. This has allowed Northern headquarters to better monitor suppliers, specially those in less routine-intensive industries –which were harder to monitor prior to the IT revolution.

Keywords: Mergers and Acquisitions; Information Technologies; Routine Intensity (search for similar items in EconPapers)
JEL-codes: D23 F14 F23 L22 (search for similar items in EconPapers)
Date: 2013-07, Revised 2013-11
New Economics Papers: this item is included in nep-com and nep-ict
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Persistent link: https://EconPapers.repec.org/RePEc:tse:wpaper:27548

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