ادغام و ادغام مرزی در مقابل سرمایه گذاری سبز مستقیم خارجی: نقش ناهمگنی شرکت

We develop a general equilibrium model with heterogeneous firms to address two sets of questions: (1) what are the characteristics of firms that choose the various modes of foreign market access (exporting, greenfield FDI, and cross-border M&A), and (2) how does the international organization of production vary across industries and country-pairs? We show that the answers to these questions depend on the nature of firm heterogeneity. Depending on whether firms differ in their mobile or immobile capabilities, cross-border mergers involve the most or the least efficient active firms. The comparative statics on industry and country characteristics display a similar dichotomy.

In this paper, we develop a general equilibrium model of international trade and investment with heterogeneous firms. Firms can access foreign markets through exports, greenfield foreign direct investment, or cross-border merger and acquisition. In equilibrium, different firms choose different modes of foreign market access. The aim of this paper is to derive the “international organization of production”: the mapping from firm type to mode of foreign market access. We show that the international organization of production is fundamentally different from one industry to another, depending crucially on the nature of firm heterogeneity. In an increasingly globalized world, the decision of how best to serve foreign markets is becoming one of the key challenges facing firms. A firm that has decided to sell its product abroad has two distinct options of serving foreign markets: exporting or producing locally (foreign direct investment (FDI)). If the firm decides to produce locally, it can choose between building its own establishment (greenfield investment) or to acquire an existing firm (cross-border merger and acquisition (M&A)). While most of the empirical and theoretical literature has not distinguished between the two modes of FDI, greenfield and cross-border M&A, both are quantitatively important. According to UNCTAD (2000), the ratio of the value of global cross-border M&A to the value of global FDI ($865bn in 1999) is about 80%. According to the “resource-based view of the firm” popular in the Management Strategy literature, heterogeneity across firms in their performance can ultimately be traced to the interplay between a firm's endowment of complementary “capabilities” or intangible assets (Wernerfelt, 1984). According to this view, mergers and acquisitions arise as firms can exploit complementarities among their capabilities. In an international context, the management strategy literature posits that some capabilities, such as marketing, distribution, and country-specific institutional competency are imperfectly mobile across countries (Anand and Delios, 2002). Cross-border M&A are then motivated by the desire of foreign firms to exploit complementarities between local firms' country-specific capabilities and the acquiring firms' “intangible technological advantages.” That is, cross-border M&A are driven by the complementarities between internationally mobile and non-mobile capabilities. Caves (1996, p. 70) summarizes this motive as follows: The going concern is a working coalition. From the viewpoint of the foreign MNE, it possesses an operating local management familiar with the national market environment. The MNE that buys the local firm also buys access to a stock of valuable information. A cross-border acquisition thus allows a firm to get costly access to the country-specific capabilities of the acquired firm, and the price of such an acquisition is governed by demand and supply of firms in the market for corporate control. In contrast, by engaging in greenfield FDI, a firm brings only its own capabilities to work abroad. Different firms will solve this trade-off differently. One contribution of this paper is to introduce the “resource-based view of the firm” into a general equilibrium model of international trade and investment in which firms can choose between different modes of foreign market access (exporting vs. greenfield FDI vs. cross-border M&A). There are three key ingredients. First, there is heterogeneity in firms' capabilities. Second, these capabilities differ in their degree of international mobility. Third, firms can participate in the merger market so as to exploit complementarities between capabilities. We then use this framework to address two sets of questions: (1) What are the characteristics of firms that choose these various modes of foreign market access, and (2) How does the international organization of production – i.e., the mapping from firm type to mode of foreign market access – vary across industries and country-pairs? Our framework has important implications for our understanding of international trade and investment. First, because we distinguish between mobile and non-mobile capabilities we introduce to the trade literature a new motive for firms to engage in FDI: to obtain non-mobile capabilities in other countries. We find that as capabilities become relatively less mobile internationally that cross-border M&A becomes the favored mode of entry into foreign markets. Given the relative importance of cross-border M&A in total FDI, our framework suggests that a key motive for FDI is to obtain non-mobile capabilities. To our knowledge, the empirical trade literature ignores the role of non-mobile capabilities in the trade-off between exports and FDI. Second, we show that the source of firm heterogeneity is a critical determinant of the international organization of production. While firms have long been known to differ within industries in terms of their observed efficiency, the underlying source of this heterogeneity is likely to differ across industries. In industries where firms differ mainly in their mobile capabilities, the most efficient firms will engage in cross-border M&A, while in industries where firms differ mainly in their country-specific non-mobile capabilities, cross-border M&A will involve the least efficient active firms.2 This dichotomy has wide-ranging implications for empirical work. A small but fast-growing empirical literature seeks to understand the relationship between a firm's characteristics and its choice of mode of serving foreign markets. By and large, researchers impose a single mapping from firm characteristics to mode choice across industries and obtain mixed results. Our theory suggests the common procedure of pooling industries in regression analyses is inappropriate as the mapping from firm characteristics to mode choices differs qualitatively across industries in a systematic fashion. Third, we show that the possibility of efficiency-enhancing mergers and acquisitions has wide-ranging implications for the productivity effects of changes in country and industry characteristics. In our model, foreign firms acquire local non-mobile capabilities by taking over local firms. Mergers and acquisitions thus have a direct effect on the nature of firms producing in a country and so influence aggregate industry efficiency. To the extent that changes in country and industry characteristics alter supply and demand in the market for corporate control, the effect of changes in these characteristics is mediated by the merger market. In models without cross-border M&A, the effect of country and industry variables on aggregate industry efficiency can be dramatically different. Our results are thus of interest to a growing empirical research into the effect of international trade and investment on aggregate industry efficiency. 1.1. Related literature Our paper contributes to a growing literature that analyzes the endogenous selection of heterogeneous firms into modes of foreign market entry.3 Within this literature, the paper that is closest in spirit to ours is Helpman et al. (2004) who consider only two modes of foreign market entry: exports and greenfield FDI. An important feature we share with Helpman et al. (HMY) and most of the trade literature on FDI is that we assume that, because of contracting problems, all activities have to be undertaken within the firm.4 The key differences between our paper and that of HMY is that (i) we introduce the idea that not all types of capabilities are perfectly mobile internationally, and (ii) in our model, firms can participate in the merger market so as to exploit complementarities in their capabilities. By considering both mobile and non-mobile capabilities, our framework (1) gives rise to cross-border M&A, and (2) yields different predictions on the composition of international commerce. In HMY, firms that engage in FDI are the most efficient firms within an industry. In contrast, we find that firms conducting FDI via cross-border M&A are the least efficient active firms when the source of firm heterogeneity is due to non-mobile capabilities. We also find that the merger market clearing condition, not present in HMY, has important implications for the effect of country and industry characteristics on the distribution of firm efficiencies. Our paper also contributes to the industrial organization literature on endogenous horizontal mergers. In contrast to our paper, this literature has mainly been concerned with market power as the driving force of mergers, and with the limits of monopolization through acquisition (e.g., Kamien and Zang, 1990 and Nocke, 2000). One notable exception is the paper by Jovanovic and Braguinsky (2004) that also takes a resource-based view of the firm. The literature on cross-border M&A is still in its infancy, and authors in this literature have also focused on market power as the motivation for mergers (e.g., Head and Ries, 1997, Horn and Persson, 2001, Neary, 2003 and Raff et al., 2005).5 1.2. Outline The plan of the paper is as follows. In the next section, we describe in detail our theoretical framework. Then, in Section 3, we turn to the equilibrium analysis. We derive the international organization of production and show how it depends on the source of firm heterogeneity. In Section 4, we investigate the effects of country and industry characteristics on the international organization of production and the distribution of firm efficiencies. In Section 5, we discuss the empirical implications of our model. We conclude in Section 6.

In this paper, we have developed a general equilibrium model in which firms can choose between three different modes of foreign market access: exporting, greenfield FDI, and cross-border mergers and acquisitions. Our framework is based on three key ideas. First, there is heterogeneity in firms' capabilities. Second, these capabilities differ in their degree of international mobility. Third, firms can participate in a merger market so as to exploit complementarities in their capabilities. We have applied this framework to address two sets of questions: (1) what are the characteristics of firms that choose the different modes of foreign market access, and (2) what are the effects of country and industry characteristics on this international organization of production? A main result of our analysis is that the source of firm heterogeneity is a critical industry characteristic for the international organization of production. Depending on whether firms differ in their mobile or non-mobile capabilities, cross-border M&A involves either the most or the least efficient active firms. The source of firm heterogeneity also plays an important role for the effects of country and industry characteristics on the distribution of firm efficiencies. Our analysis has also highlighted the importance of the merger market clearing condition for the predictions of our model. Since the changes in country and industry characteristics directly impact upon entrants' participation decisions on the merger market, the effect of these characteristics on aggregate industry efficiency is mediated by the merger market. In this paper, we have assumed that countries are of the same size. In a previous version of the paper, Nocke and Yeaple (2004b), we investigated the effects of asymmetric changes in country size on the international organization of production. There, we showed that country size “matters” and that its effect crucially depends on the source of firm heterogeneity. In this paper, we have also assumed that, in each industry, there is only one source of firm heterogeneity: either in mobile or in non-mobile capabilities. In Nocke and Yeaple (2004a), we allow for general two-sided heterogeneity but, for reasons of tractability, abstract from trade costs. Our theory may fruitfully be used as a framework to inform government policies toward international commerce. Because cross-border M&A involves the acquisition of a local firm by a foreign multinational enterprise, cross-border M&A brings “less” to the host country's economy than greenfield FDI. Moreover, as our analysis has shown, firms with different capabilities choose different modes of foreign market access. Hence, the optimal government policy toward foreign direct investment should be tailored to the particular type of FDI: greenfield vs. cross-border M&A. A rigorous analysis of the policy implications of our theory, however, raises a number of modeling issues (government objectives, set of policy instruments) that we plan to address in a separate paper.