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- ISIDORE Id: 10670/1.5cd80b...
- hal: hal-02111499
- doi: 10.1016/j.jinteco.2019.01.008
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info:eu-repo/semantics/altIdentifier/doi/10.1016/j.jinteco.2019.01.008
info:eu-repo/semantics/OpenAccess
Mots-clés
Foreign direct investment Foreign ownership Mergers and acquisitions Financial development Institutional qualitySujets proches
Funds Funding Finance, commerce, confiscations, etcCiter ce document
Ron Alquist et al., « Financial constraints, institutions, and foreign ownership », HAL SHS (Sciences de l’Homme et de la Société), ID : 10.1016/j.jinteco.2019.01.008
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Résumé
We develop a model of cross-border acquisitions in which the foreign acquirer's ownership choice reflects a trade-off between easing the target's credit constraints and the costs of operating in an environment with weak institutions. Data on domestic and foreign acquisitions in emerging markets over the period 1990–2007 support the model predictions. The share of full foreign acquisitions is higher in sectors more reliant on external finance, in countries with lower financial development, and in countries with higher institutional quality. Sectoral external finance dependence accentuates the effect of country-level financial development and institutional quality. By contrast, the level of foreign ownership in partial acquisitions is insensitive to institutional factors and depends weakly on financial factors.
