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Lost in Translation? The Effect of Cultural Values on Mergers Around the World
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The authors found that the volume of cross-border mergers is lower when countries are more culturally distant and that greater cultural distance in trust and individualism leads to lower combined announcement returns.Abstract:
We find strong evidence that three key dimensions of national culture (trust, hierarchy, and individualism) affect merger volume and synergy gains. The volume of cross-border mergers is lower when countries are more culturally distant. In addition, greater cultural distance in trust and individualism leads to lower combined announcement returns. These findings are robust to year and country-level fixed effects, time-varying country-pair and deal-level variables, as well as instrumental variables for cultural differences based on genetic and somatic differences. The results are the first large-scale evidence that cultural differences have substantial impacts on multiple aspects of cross-border mergers.read more
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The Limits of Organization
TL;DR: The Limits of Organization as discussed by the authors is a seminal work in the field of economic analysis and policy making, focusing on the role of organization in economic decision-making, and its effect on economic outcomes.
Posted Content
Prologue to The Difference: How the Power of Diversity Creates Better Groups, Firms, Schools, and Societies
TL;DR: The Difference as discussed by the authors is a landmark book about how we think in groups and how our collective wisdom exceeds the sum of its parts, and how groups that display a range of perspectives outperform groups of like-minded experts.
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Determinants of Cross-Border Mergers and Acquisitions
TL;DR: In this article, the authors provide an analysis of 56,978 cross-border mergers occurring between 1990 and 2007 and characterize the patterns of who buys whom, with firms being much more likely to purchase firms in nearby countries than in countries far away.
Journal ArticleDOI
Does One Belt One Road initiative promote Chinese overseas direct investment
Julan Du,Yifei Zhang +1 more
TL;DR: In response to the One Belt One Road (OBOR) initiative, China's overseas direct investment (ODI), especially whole or majority-ownership mergers and acquisitions, rose significantly in the belt-road countries, especially the ones along the continental route as discussed by the authors.
References
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Journal ArticleDOI
The Economic Institutions of Capitalism
TL;DR: The Economic Institutions of Capitalism as mentioned in this paper is a seminal work in the field of economic institutions of capitalism. Journal of Economic Issues: Vol. 21, No. 1, pp. 528-530.
Book
Culture′s Consequences: Comparing Values, Behaviors, Institutions and Organizations Across Nations
TL;DR: In this paper, values and culture data collection, treatment and validation power distance Uncertainty Avoidance Individualism and Collectivism Masculinity and Femininity Long versus Short-Term Orientation Cultures in Organizations Intercultural Encounters Using Culture Dimension Scores in Theory and Research
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Law and Finance
Rafael La Porta,Rafael La Porta,Florencio Lopez de Silanes,Florencio Lopez de Silanes,Andrei Shleifer,Andrei Shleifer,Robert W. Vishny,Robert W. Vishny +7 more
TL;DR: This paper examined legal rules covering protection of corporate shareholders and creditors, the origin of these rules, and the quality of their enforcement in 49 countries and found that common law countries generally have the best, and French civil law countries the worst, legal protections of investors.
Journal ArticleDOI
Legal Determinants of External Finance
TL;DR: The authors showed that countries with poorer investor protections, measured by both the character of legal rules and the quality of law enforcement, have smaller and narrower capital markets than those with stronger investor protections.