Working Paper No. 927

International Mergers with Financially Constrained Owners

Published: September 24, 2012Pages: 32Keywords: Investment Liberalization; Mergers & Acquisitions; Corporate Governance; OwnershipJEL-codes: F23; K21; L13; O12

International Mergers with Financially Constrained Owners Aron Berg, Pehr-Johan Norbäck and Lars Persson

This paper proposes a cross-border M&A model with financially constrained owners in which the identity of the buyer and seller can be determined. We show that policies blocking foreign acquisitions to protect the domestic industry can be counterproductive. Foreign acquisition can increase the domestic owner’s investment in growth industries by reducing their financial restrictions. This calls for a ”financial” efficiency defense in the merger law. We also show that cross-border M&As are not only driven by effects on the merged entity, but also driven by the seller’s alternative investment opportunities.

Pehr-Johan Norbäck


Ph: +46 8 665 4522
Mob: +46 73 547 3379

Lars Persson


Ph: +46 8 665 4504

Aron Berg


Mob: +46 73 445 1425

Sick of Inequality?

An Introduction to the Relationship between Inequality and Health

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In this book Andreas Bergh, Therese Nilsson, IFN and Lund University, and Daniel Waldenström, IFN and Paris School of Economics, France, review the latest research on the relationship between inequality and health. What does inequality mean for our health? Does increasing income inequality affect outcomes such as obesity, life expectancy and subjective well-being?


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