Roger Bandick: Department of Economics, Aarhus School of Business, Postal: Handels- og IngeniørHøjskolen (Institute of Business and Technology) Aarhus Universitet (Aarhus University), Birk Centerpark 15, 7400 Herning, Denmark
Abstract: This paper studies the effect of foreign acquisition on wages and total factor productivity (TFP) in the years following a takeover by using unique detailed firm-level data for Sweden for the period 1993-2002. The paper takes particular account of the potential endogeneity of the acquisition decision (for example due to “cherry picking”) by implementing an instrumental variable approach and propensity score matching with difference-in-difference estimation technique. Moreover, in line with recent literature on firm heterogeneity in international trade, this paper allows for the acquisition effect to differ depending on whether the targeted firms were domestic multinational or non-multinationals before the foreign takeover. This paper also allows for the acquisition effect to differ depending on whether the acquisition is horizontal or vertical. The result shows that foreign acquisition has no effects on overall, skilled or less-skilled wage growth neither in targeted Swedish MNEs nor in targeted Swedish non-MNEs and neither if the acquisition was motivated by vertical or horizontal motives. However, the results indicate that both targeted Swedish MNEs and non- MNEs have better growth in TFP after vertical foreign acquisition only but no such impact from horizontal foreign acquisition
32 pages, January 1, 2010
Full text files
Questions (including download problems) about the papers in this series should be directed to Helle Vinbaek Stenholt ()
Report other problems with accessing this service to Sune Karlsson ().
This page generated on 2018-01-23 23:30:49.