International Trade and Propagation of Merger Waves

76 Pages Posted: 20 Apr 2017 Last revised: 26 Jan 2018

See all articles by Muhammad Farooq Ahmad

Muhammad Farooq Ahmad

SKEMA Business School – Université Côte d'Azur

Eric de Bodt

NHH-Caltech

Jarrad Harford

University of Washington

Date Written: November 18, 2017

Abstract

Cross-border merger activity is growing in importance. We map the global trade network each year from 1989 to 2016 and compare it to cross-border and domestic merger activity. Trade-weighted merger activity in trading partner countries has statistically and economically significant explanatory power for the likelihood a given country will be in a merger wave state, both at the cross-border and the domestic levels, even controlling for its own lagged merger activity. The strength of trade as a channel for transmitting merger waves varies over time and is affected by import tariffs cuts, Euro, EU, EEA, and WTO entry. Overall, the full trade network helps our understanding of merger waves and how merger waves propagate across borders.

Keywords: International Trade Merger Waves

JEL Classification: G34

Suggested Citation

Ahmad, Muhammad Farooq and de Bodt, Eric and Harford, Jarrad, International Trade and Propagation of Merger Waves (November 18, 2017). Available at SSRN: https://ssrn.com/abstract=2955638 or http://dx.doi.org/10.2139/ssrn.2955638

Muhammad Farooq Ahmad

SKEMA Business School – Université Côte d'Azur ( email )

Campus de Lille, Avenue Willy Brandt,
Lille, 59777
France

HOME PAGE: http://sites.google.com/site/mfarooqahmad85

Eric De Bodt (Contact Author)

NHH-Caltech ( email )

18B AVENUE BECHET
Kraainem, 1950
Belgium
+32 475 24 01 69 (Phone)

HOME PAGE: http://www.edebodt.eu

Jarrad Harford

University of Washington ( email )

Box 353226
Seattle, WA 98195-3226
United States
206-543-4796 (Phone)
206-543-7472 (Fax)

HOME PAGE: http://faculty.washington.edu/jarrad/

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