Cross-border Mergers as Instruments of Comparative Advantage*
نویسنده
چکیده
A two-country model of oligopoly in general equilibrium is used to show how changes in market structure accompany the process of trade and capital market liberalisation. The model predicts that bilateral mergers in which low-cost firms buy out higher-cost foreign rivals are profitable under Cournot competition. With symmetric countries, welfare may rise or fall, though the distribution of income always shifts towards profits. The model implies that trade liberalisation can trigger international merger waves, in the process encouraging countries to specialise and trade more in accordance with comparative advantage. JEL: F10, F12, L13
منابع مشابه
CeGE - Discussion Paper 34 J . Peter Neary Cross - Border Mergers as Instruments of Comparative Advantage GEORG - AUGUST - UNIVERSITÄT GÖTTINGEN
A two-country model of oligopoly in general equilibrium is used to show how changes in market structure accompany the process of trade and capital market liberalisation. The model predicts that bilateral mergers in which low-cost firms buy out higher-cost foreign rivals are profitable under Cournot competition. With symmetric countries, welfare may rise or fall, though the distribution of incom...
متن کاملA comparative ownership advantage framework for cross-border M&As: The rise of Chinese and Indian MNEs
MNEs from emerging economies (EE MNEs) have recently undertaken aggressive cross-border mergers and acquisitions (M&As). This phenomenon challenges the current understanding in the international business literature. Integrating the comparative advantage theory with Dunning’s OLI paradigm, this article develops a comparative ownership advantage framework characterized by five attributes: (1) nat...
متن کاملCross Border Mergers and Acquisitions by Indian firms-An Analysis of Pre and Post Merger performance
The corporate sector all over the world is restructuring its operations through different types of consolidation strategies like mergers and acquisitions in order to face challenges posed by the new pattern of globalization, which has led to the greater integration of national and international markets.. The intensity of cross-border operations recorded an unprecedented ...
متن کاملCross-border mergers and acquisitions by emerging market firms: A comparative investigation ¬リニ
This paper applies and extends resource dependence theory (RDT) to comparatively investigate major factors that determine the level of cross-border mergers and acquisitions (M&As) by emerging market firms (EMFs) in developed and developing markets. We argue that the resource dependence logic of M&As (or simply the M&A logic) provides a unique perspective in better understanding the internationa...
متن کاملAn Analysis of Cross-Border Mergers and Acquisitions’ Effects on China’s Automotive Industry Security and the Countermeasures
Along with the opening up of China economy, cross-border mergers and acquisitions exert a greater effect on China’s industrial security. This paper is chiefly to discuss the influences of cross-border mergers and acquisitions on China automotive industry security. Based on convincible investigations and researches, this paper analyzes China automotive industry’s domestic demand conditions, self...
متن کامل