Explaining the trends in the UK cross-border mergers & acquisitions: An analysis of macro-economic factors
Most of the growth in international production over the past decades has been via cross-border mergers and acquisitions (CBM&As). Yet prior studies examining the trajectory of cross-border M&A activities as an entry mode of FDI have focused on industry and firm level factors. Dunning (2009) emphasised the importance of macroeconomic variables which may explain foreign direct investment and called for more research to improve our understanding on the effects of macroeconomic variables. Building on prior studies, this study attempts to investigate the role of macroeconomic influences on CBM&As activities in the UK over the 1987-2006 period. This study finds that GDP, exchange rate, interest rate and share prices have significant impact on the level of outward UK CBM&As. On the other hand, GDP, money supply and share price have statistically significant impact on the UK CBM&As inflows.
If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
Volume (Year): 20 (2011)
Issue (Month): 5 (October)
|Contact details of provider:|| Web page: http://www.elsevier.com/wps/find/journaldescription.cws_home/133/description#description|
|Order Information:|| Postal: http://www.elsevier.com/wps/find/journaldescription.cws_home/133/bibliographic|
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Roger Clarke & Christos Ioannidis, 1994. "Mergers and Excess Deposits: Some Evidence for the UK," International Journal of the Economics of Business, Taylor & Francis Journals, vol. 1(3), pages 377-385.
- Tolentino, Paz Estrella, 2010. "Home country macroeconomic factors and outward FDI of China and India," Journal of International Management, Elsevier, vol. 16(2), pages 102-120, June.
- Kiymaz, Halil, 2009. "The impact of country risk ratings on U.S. firms in large cross-border acquisitions," Global Finance Journal, Elsevier, vol. 20(3), pages 235-247.
- Vasconcellos, G. M. & Kish, R. J., 1998. "Cross-border mergers and acquisitions: the European-US experience," Journal of Multinational Financial Management, Elsevier, vol. 8(4), pages 431-450, November.
- Bang Nam Jeon & Sung Sup Rhee, 2008. "The Determinants Of Korea'S Foreign Direct Investment From The United States, 1980-2001: An Empirical Investigation Of Firm-Level Data," Contemporary Economic Policy, Western Economic Association International, vol. 26(1), pages 118-131, 01.
- John H Dunning, 2009. "Location and the multinational enterprise: A neglected factor?," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 40(1), pages 5-19, January.
- Oxelheim, Lars & Randøy, Trond & Stonehill, Arthur, 2001.
"On the Treatment of Finance-Specific Factors Within the OLI Paradigm,"
Working Paper Series
554, Research Institute of Industrial Economics.
- Oxelheim, Lars & Randøy, Trond & Stonehill, Arthur, 2001. "On the treatment of finance-specific factors within the OLI paradigm," International Business Review, Elsevier, vol. 10(4), pages 381-398, August.
- Goergen, M. & Renneboog, L.D.R., 2002.
"Shareholder Wealth Effects of European Domestic and Cross-Border Takeover Bids,"
2002-50, Tilburg University, Center for Economic Research.
- Marc Goergen & Luc Renneboog, 2004. "Shareholder Wealth Effects of European Domestic and Cross-border Takeover Bids," European Financial Management, European Financial Management Association, vol. 10(1), pages 9-45.
- Golbe, Devra L & White, Lawrence J, 1993. "Catch a Wave: The Time Series Behavior of Mergers," The Review of Economics and Statistics, MIT Press, vol. 75(3), pages 493-499, August.
- Roberto, Basile, 2004.
"Acquisition versus greenfield investment: the location of foreign manufacturers in Italy,"
Regional Science and Urban Economics,
Elsevier, vol. 34(1), pages 3-25, January.
- Roberto Basile, 2002. "Acquisition versus greenfield investment: the location of foreign manufacturers in Italy," ISAE Working Papers 27, ISTAT - Italian National Institute of Statistics - (Rome, ITALY).
- Stoian, Carmen & Filippaios, Fragkiskos, 2008. "Dunning's eclectic paradigm: A holistic, yet context specific framework for analysing the determinants of outward FDI: Evidence from international Greek investments," International Business Review, Elsevier, vol. 17(3), pages 349-367, June.
- Andrei Shleifer & Robert W. Vishny, 2001.
"Stock Market Driven Acquisitions,"
NBER Working Papers
8439, National Bureau of Economic Research, Inc.
- Nachum, L. & Rolle, J. D., 1999. "Home country and firm-specific ownership advantages: A study of US, UK and French advertising agencies," International Business Review, Elsevier, vol. 8(5-6), pages 633-660, October.
- Michael McCann, 2001. "Cross-border acquisitions: the UK experience," Applied Economics, Taylor & Francis Journals, vol. 33(4), pages 457-461.
- Li, Ji & Lam, Kevin C. K. & Karakowsky, Leonard & Qian, Gongming, 2003. "Firm resource and first mover advantages: A case of foreign direct investment (FDI) in China," International Business Review, Elsevier, vol. 12(5), pages 625-645, October.
- Yang, Jeannie Yih Yun & Groenewold, Nicolaas & Tcha, Moonjoong, 2000. "The Determinants of Foreign Direct Investment in Australia," The Economic Record, The Economic Society of Australia, vol. 76(232), pages 45-54, March.
- Brouthers, Keith D. & Brouthers, Lance Eliot & Werner, Steve, 1996. "Dunning's eclectic theory and the smaller firm: The impact of ownership and locational advantages on the choice of entry-modes in the computer software industry," International Business Review, Elsevier, vol. 5(4), pages 377-394, August.
- Sanjeev Agarwal & Sridhar N Ramaswami, 1992. "Choice of Foreign Market Entry Mode: Impact of Ownership, Location and Internationalization Factors," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 23(1), pages 1-27, March.
- Harris, Robert S & Ravenscraft, David, 1991. " The Role of Acquisitions in Foreign Direct Investment: Evidence from the U.S. Stock Market," Journal of Finance, American Finance Association, vol. 46(3), pages 825-844, July.
- Steven Globerman & Daniel M Shapiro, 1999. "The Impact of Government Policies on Foreign Direct Investment: The Canadian Experience," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 30(3), pages 513-532, September.
- Jaideep Anand & Bruce Kogut, 1997. "Technological Capabilities of Countries, Firm Rivalry and Foreign Direct Investments," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 28(3), pages 445-465, September.
- Melicher, Ronald W & Ledolter, Johannes & D'Antonio, Louis J, 1983. "A Time Series Analysis of Aggregate Merger Activity," The Review of Economics and Statistics, MIT Press, vol. 65(3), pages 423-430, August.
- Engle, Robert & Granger, Clive, 2015.
"Co-integration and error correction: Representation, estimation, and testing,"
Publishing House "SINERGIA PRESS", vol. 39(3), pages 106-135.
- Engle, Robert F & Granger, Clive W J, 1987. "Co-integration and Error Correction: Representation, Estimation, and Testing," Econometrica, Econometric Society, vol. 55(2), pages 251-276, March.
- Kenneth A. Froot & Jeremy C. Stein, 1991. "Exchange Rates and Foreign Direct Investment: An Imperfect Capital Markets Approach," The Quarterly Journal of Economics, Oxford University Press, vol. 106(4), pages 1191-1217.
- Pablo, Eduardo, 2009. "Determinants of cross-border M&As in Latin America," Journal of Business Research, Elsevier, vol. 62(9), pages 861-867, September.
- Vasconcellos, Geraldo M. & Kish, Richard J., 1996. "Factors affecting cross-border mergers and acquisitions: The Canada-U.S. experience," Global Finance Journal, Elsevier, vol. 7(2), pages 223-238.
- Peter Nisbet & Wayne Thomas & Stuart Barrett, 2003. "UK direct investment in the United States: a mode of entry analysis," International Journal of the Economics of Business, Taylor & Francis Journals, vol. 10(3), pages 245-259.
- John H Dunning, 1988. "The Eclectic Paradigm of International Production: A Restatement and Some Possible Extensions," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 19(1), pages 1-31, March.
- Blonigen, Bruce A, 1997. "Firm-Specific Assets and the Link between Exchange Rates and Foreign Direct Investment," American Economic Review, American Economic Association, vol. 87(3), pages 447-465, June.
- Ali-Yrkkö, Jyrki, 2002. "Mergers and Acquisitions - Reasons and Results," Discussion Papers 792, The Research Institute of the Finnish Economy.
- John H Dunning, 1995. "Reappraising the Eclectic Paradigm in an Age of Alliance Capitalism," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 26(3), pages 461-491, September.
- Marcelo Resende, 2005.
"Mergers and Acquisitions Waves in the U.K.: a Markov-Switching Approach,"
Economics Working Papers
ECO2005/04, European University Institute.
- Marcelo Resende, 2008. "Mergers and acquisitions waves in the UK: a Markov-switching approach," Applied Financial Economics, Taylor & Francis Journals, vol. 18(13), pages 1067-1074.
- Harford, Jarrad, 2005. "What drives merger waves?," Journal of Financial Economics, Elsevier, vol. 77(3), pages 529-560, September.
- Rhodes-Kropf, Matthew & Robinson, David T. & Viswanathan, S., 2005. "Valuation waves and merger activity: The empirical evidence," Journal of Financial Economics, Elsevier, vol. 77(3), pages 561-603, September.
- Ralph L. Nelson, 1959. "Merger Movements in American Industry, 1895-1956," NBER Books, National Bureau of Economic Research, Inc, number nels59-1.
- Yagil, Joseph, 1996. "Mergers and macro-economic factors," Review of Financial Economics, Elsevier, vol. 5(2), pages 181-190.
- Dewenter, Kathryn L, 1995. "Do Exchange Rate Changes Drive Foreign Direct Investment?," The Journal of Business, University of Chicago Press, vol. 68(3), pages 405-433, July.
- Hong, Sunghoon & Kim, Sangho, 2003. "Locational Determinants of Korean Manufacturing Investments in the European Union," Hitotsubashi Journal of Economics, Hitotsubashi University, vol. 44(1), pages 91-103, June.
- Caves, Richard E., 1989. "Mergers, takeovers, and economic efficiency : Foresight vs. hindsight," International Journal of Industrial Organization, Elsevier, vol. 7(1), pages 151-174, March.
- Forssbæck, Jens & Oxelheim, Lars, 2008. "Finance-specific factors as drivers of cross-border investment--An empirical investigation," International Business Review, Elsevier, vol. 17(6), pages 630-641, December.
- Somlev, Ilian P. & Hoshino, Yasuo, 2005. "Influence of location factors on establishment and ownership of foreign investments: The case of the Japanese manufacturing firms in Europe," International Business Review, Elsevier, vol. 14(5), pages 577-598, October.
When requesting a correction, please mention this item's handle: RePEc:eee:iburev:v:20:y:2011:i:5:p:547-556. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Dana Niculescu)
If references are entirely missing, you can add them using this form.