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


  • Florian Szücs


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.

Suggested Citation

  • Florian Szücs, 2013. "M&A and R&D: Asymmetric Effects on Acquirers and Targets?," Discussion Papers of DIW Berlin 1331, DIW Berlin, German Institute for Economic Research.
  • Handle: RePEc:diw:diwwpp:dp1331

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    References listed on IDEAS

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    More about this item


    Mergers; R&D growth; R&D intensity; propensity-score matching; difference in difference estimation;

    JEL classification:

    • D22 - Microeconomics - - Production and Organizations - - - Firm Behavior: Empirical Analysis
    • G34 - Financial Economics - - Corporate Finance and Governance - - - Mergers; Acquisitions; Restructuring; Corporate Governance
    • O3 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights

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