Cross-Country Determinants of Mergers and Acquisitions

40 Pages Posted: 29 May 2003

See all articles by Stefano Rossi

Stefano Rossi

Bocconi University; Krannert School of Management; Centre for Economic Policy Research (CEPR)

Paolo F. Volpin

City University London - Faculty of Finance; Centre for Economic Policy Research (CEPR); European Corporate Governance Institute (ECGI)

Multiple version iconThere are 2 versions of this paper

Date Written: September 2003


We study the determinants of mergers and acquisitions around the world by focusing on differences in laws and regulation across countries. We find that the volume of M&A activity is significantly larger in countries with better accounting standards and stronger shareholder protection. The probability of an all-cash bid decreases with the level of shareholder protection in the acquirer country. In cross-border deals targets are typically from countries with poorer investor protection than acquirers, suggesting that cross-border transactions play a governance role by improving the degree of investor protection within target firms.

Keywords: Mergers and acquisitions, Corporate governance, Investor protection

JEL Classification: G21, G28, G32

Suggested Citation

Rossi, Stefano and Volpin, Paolo F., Cross-Country Determinants of Mergers and Acquisitions (September 2003). ECGI - Finance Working Paper No. 25/2003; AFA 2004 San Diego Meetings; EFA 2003 Annual Conference Paper No. 251. Available at SSRN: or

Stefano Rossi

Bocconi University ( email )

Via Roentgen 1
Milano, MI 20136

Krannert School of Management ( email )

West Lafayette, IN 47907-1310
United States

Centre for Economic Policy Research (CEPR) ( email )

United Kingdom

Paolo F. Volpin (Contact Author)

City University London - Faculty of Finance ( email )

London, EC2Y 8HB
Great Britain

Centre for Economic Policy Research (CEPR)

United Kingdom

European Corporate Governance Institute (ECGI)

B-1050 Brussels

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