Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/19674 
Year of Publication: 
2006
Series/Report no.: 
Discussion Paper Series 1 No. 2006,45
Publisher: 
Deutsche Bundesbank, Frankfurt a. M.
Abstract: 
Technological change is often hypothesized as one of the main drivers of merger activities. This paper analyzes the role of technology in mergers and acquisitions (M&As) at the firm level. Based on a newly created data set that combines financial information and patent data for public limited companies in Europe as well as country level variables, we apply a structural model to investigate technology-related motivations behind merger formation. Distinguishing between cross-border and domestic M&As, we find that technological relatedness of the M&A partners reduces uncertainty and the expected risk of failure associated with cross-border acquisitions significantly, whereas there is no evidence for technological complementarities driving domestic M&As. The relevance of technology for crossborder M&As further illustrates the international character of technology markets.
Subjects: 
domestic versus cross-border M&As
technological relatedness
market relatedness
JEL: 
O32
O34
G34
C25
Document Type: 
Working Paper

Files in This Item:
File
Size
522.53 kB





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.