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Identifier to cite or link to this item: https://hdl.handle.net/10086/14075

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Title
Do Out-In M&As Bring Higher TFP to Japan?: An Empirical Analysis Based on Micro-data on Japanese Manufacturing Firms
Creator
Creator Name
Fukao, Kyoji Fukao, Kyoji
深尾, 京司 深尾, 京司
フカオ, キョウジ フカオ, キョウジ
Affiliation
Affiliation Name
Research Institute of Economy, Trade and Industry
Affiliation
Affiliation Name
Hitotsubashi University
Creator Name
Ito, Keiko Ito, Keiko
伊藤, 恵子 伊藤, 恵子
イトウ, ケイコ イトウ, ケイコ
Affiliation
Affiliation Name
Senshu University
Creator Name
Kwon, Hyeog Ug Kwon, Hyeog Ug
権, 赫旭 権, 赫旭
Affiliation
Affiliation Name
Hitotsubashi University
Editor
Contributor Name
社会科学における統計分析拠点構築 = Research Unit for Statistical Analysis in Social Sciences
Key Word
FDI
TFP
in-in M&A
out-in M&A
JEL
F23
Abstract
This paper compares the performance of foreign-owned and domestically-owned firms, using micro data on Japanese firms in the manufacturing sector for the period 1994-2000. The overall comparison between foreign-owned and Japanese companies shows that foreign-owned companies enjoyed 5% higher TFP as well as higher earnings and returns on capital. They also displayed a higher capital-labor ratio and higher R&D intensity. Reflecting their higher TFP and labor-saving production patterns, foreign-owned companies showed higher labor productivity and wage rates as well. By estimating Probit models, we found that foreign firms acquire Japanese firms with higher TFP levels and higher profit rates. In contrast, in-in M&As seem to have the characteristics of rescue missions. Small firms with a higher total liability/total asset ratio tend to be chosen as targets of in-in M&As. We also estimated the dynamic effects of M&As on target firms. The results indicate that out-in M&As improve target firms' TFP level and current profit/sales ratio. Compared with in-in M&As, out-in M&As bring a larger and quicker improvement in TFP and the profit rate but no increase in target firms' employment two years after the acquisition.
Publisher
Institute of Economic Research, Hitotsubashi University
Issued Date
2004-09
Language
English(eng)
Resource Type
technical report
Version Type
VoR
Is Part OfRelation -
Related Title
Hi-Stat Discussion paper series ; No. d04-41
Number of Pages
46
Sponsorship
21世紀COEプログラム = 21st-Century COE Program
Appears in Collections
Hi-Stat Discussion paper series
URL
https://hdl.handle.net/10086/14075