Aula Magna ex Facoltà di Economia
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Presentation of the paper
The concurrent impact of cultural, political and spatial distances on international M&As.
Università di Cagliari
The paper explores the concurrent role of cultural, political and spatial distances on M&A deals among the 27 European Union member countries and the 16 European Neighbouring Countries. Given the high degree of heterogeneity exhibited by our sample count data, which leads to over-dispersion and excess of zero observations, we hypothesize that the relative multi-dimensional distance between any two countries has a prominent effect on the probability they engage in an M&A deal. Such a hypothesis is tested within a Zero-inflated econometric framework that enables us to model simultaneously the two different mechanisms generating the zero observations; these may be either the result of the absence of any bilateral transaction or the unsuccessful outcome of a count process. The latter is modelled along the lines of the traditional gravity framework, where the countries relative `mass' variables (population, GDP, technological capital) and their geographical distance are supposed to determine the rate of occurrence of the M&A events.
coauthors: Maria Chiara Di Guardo and Raffaele Paci.
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