International Corporate Governance Spillovers: Evidence from Cross-Border Mergers and Acquisitions

WPIEA2013234 Image
Price:  $18.00

Author/Editor: Rui Albuquerque, Luis Brandao-Marques, Miguel A Ferreira, Pedro Matos
Release Date: © November, 2013
ISBN : 978-1-47551-838-2
Stock #: WPIEA2013234
Stock Status: On back-order

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We develop and test the hypothesis that foreign direct investment promotes corporate governance spillovers in the host country. Using firm-level data on cross-border mergers and acquisitions (M&A) and corporate governance in 22 countries, we find that cross-border M&As are associated with subsequent improvements in the governance, valuation, and productivity of the target firms’ local rivals. This positive spillover effect is stronger when the acquirer is from a country with stronger shareholder protection and if the target’s industry is more competitive. We conclude that the international market for corporate control promotes the adoption of better corporate governance practices around the world.


Corporate governance , Financial institutions and markets

More publications in this series: Working Papers

More publications by: Rui Albuquerque ; Luis Brandao-Marques ; Miguel A Ferreira ; Pedro Matos