Joel Stiebale

Do Financial Constraints Matter for Foreign Market Entry? A Firm‐level Examination

Recent theoretical and empirical contributions stress the importance of financial development for international trade. This paper investigates whether financial constraints matter for foreign market entry at the firm level using dynamic panel data techniques. The empirical framework is applied to a panel of French manufacturing firms over the years 1998-2005. Although financial indicators are significantly correlated with export status and export share, there is no evidence that financial constraints have a direct impact on foreign market participation or sales in foreign markets once observed and unobserved firm heterogeneity is controlled for. This result also holds for subgroups of firms that are more likely to face financial constraints and industries that are more dependent on financial factors.

The Effects of Cross-Border M&As on the Acquirers’ Domestic Performance – Firm-Level Evidence

This paper provides empirical evidence on the effects of cross-border M&As on investing firms’ domestic performance in the U.K. and France. We build a new firm-level dataset that combines a global M&A database with balance sheet data for the years 2000–2007. Combining matching techniques with a difference-in-differences estimator, we find that cross-border deals boost on average domestic employment, sales, and investment, and they are not accompanied by a downsizing of the domestic labor force in neither of both countries. Further, acquisitions in knowledge-intensive industries lead to improvements in domestic productivity. Our results display some heterogeneity across industries and types of acquisitions, suggesting a connection between the motives for international acquisitions and their resulting effects.

Private Equity, Investment and Financial Constraints - Firm-Level Evidence for France and the United Kingdom

The welfare effects of private equity transactions are debated controversially. We analyze the impact of expansion financing and buyouts by private equity investors on investment of portfolio firms in the UK and France - two countries with different financial systems. Unobserved heterogeneity and the endogeneity of private equity transactions financed by venture capital companies are addressed using dynamic panel data techniques. In both countries we find that portfolio firms display higher investment levels and a lower dependence on internal funds after expansion financing. Buyouts financed by venture capital companies are neither associated with a decrease in investment spending nor with an increase in the dependence on internal finance. In contrary, private equity based buyouts in the UK outperform non-private equity backed British firms in terms of both indicators. Contrasting the notion of several policy makers,we cannot detect that private equity based buyout financing yields higher financial constraints on average.

Outside Directors on the Board and Innovative Firm Performance

We investigate how outside directors on supervisory boards influence innovative activities of the firms they advise and monitor. Based on panel data on the largest German companies, the econometric analysis shows a positive influence of external executives on innovative firm performance, measured by patent applications. Differentiating between outside directors from innovative and non-innovative companies reveals that only outside directors from innovative firms increase patenting activities at the firms they advise and monitor. This effect increases with the technological proximity between the appointing firm and the outsiders home firm. Outside directors from non-innovative firms are negatively associated with the appointing firms innovativeness. The results indicate that external executives with an appropriate professional background can provide valuable specific knowledge and expertise to the board.

The Effects of Cross‐Border M&As on the Acquirers’ Domestic Performance: Firm-Level Evidence - Les Effets Des Fusions Et Acquisitions Transfrontaliers Sur La Performance Domestique Des Acquéreurs: Résultats AU Niveau De La Firme

This paper provides empirical evidence on the effects of cross-border mergers and acquisitions (M&As) on the acquiring firms’ domestic performance in the U.K. and France. We build a new firm-level data set that combines a global M&A database with balance sheet data for the years 2000 to 2007. Combining matching techniques with a difference-in-differences estimator, we find that cross-border M&As boost on average acquirers’ domestic sales and investment, and they are not accompanied by a downsizing of the domestic labour force in either country. Further, cross-border M&As in knowledge-intensive industries lead to improvements in domestic productivity. Our results display some heterogeneity across industries and types of acquisitions, suggesting a connection between the motives for international M&As and their resulting effects. Ce texte fournit des résultats empiriques des effets des fusions et acquisitions transfrontaliers sur la performance domestique des firmes du Royaume Uni et de la France qui ont fait les acquisitions. On construit une base de données inédites qui combine les données globales sur les fusions et acquisitions avec ce qui ressort des bilans pour les années 2000�?2007. Combinant les techniques d’arrimage avec un estimateur de différence�?dans�?les�?différences, on découvre que les fusions et acquisitions transfrontalières augmentent en moyenne les ventes et investissements domestiques des acquéreurs, et que ceci n’est pas accompagné par une réduction de la main d’œuvre dans ni l’un ni l’autre pays. De plus, les fusions et acquisitions transfrontalières dans les industries basées sur la connaissance entraînent des améliorations dans la productivité au niveau domestique. Ces résultats révèlent une certaine hétérogénéité selon les industries et les types d’acquisitions, ce qui suggère qu’il existe une connexion entre les motivations pour les fusions et acquisitions internationales et les effets qui en résultent.

The Impact of FDI on Innovation in Target Firms

This paper contributes to the ongoing debate on the welfare effects of foreign direct investment by investigating the effects of cross-border mergers and acquisitions on innovation activities in target firms. The empirical analysis is based on survey and ownership data for a large sample of small- and medium- sized German firms. After controlling for endogeneity and selection bias, it is found that foreign takeovers have a large negative impact on the propensity to perform innovation activities and a negative impact on average R&D expenditures in innovative firms. Furthermore, innovation output, measured as the share of sales from product innovations is not significantly affected by a foreign takeover for a given amount of innovation efforts. Hence, the estimation results do not show any evidence of significant technology spillovers through foreign direct investment in form of a higher innovation success.

The Impact of Foreign Acquisitions on the Investors' R&D Activities - Firm-Level Evidence

This paper provides empirical evidence on the relationship between cross-border acquisitions and innovation activities at the firm level. In contrast to previous studies that analyze the effects on innovation in target firms, this paper investigates the effects on the investing firms. For the empirical analysis a unique firm-level data set is constructed that combines survey data for German firms with a merger and acquisition database. After a cross-border acquisition, investing firms display a higher rate of domestic expenditures for research and development. After controlling for endogeneity of foreign acquisitions by estimating a two-equation system with limited dependent variables and applying instrument variable techniques it is found that part of this correlation stems from a causal effect. The estimated effects are robust towards alternative identification strategies and are higher in industries with high knowledge intensity. The analysis is complemented by an investigation of the effects on tangible investment spending and by a comparison of the effects of cross-border acquisitions to those of Greenfield foreign direct investments and domestic M&As.

Foreign direct investment, heterogeneous workers and employment security: Evidence from Germany

We analyze how foreign direct investment (FDI) affects employment security using administrative microdata for German employees. Measuring FDI intensity at the industry level enables us to take into account the sum of direct effects at multinationals as well as indirect effects of FDI throughout the affected industry. We find that both inward and outward FDI significantly reduce employment security. This is particularly the case for inward FDI coming from the western part of the European Union as well as for outward FDI going to Central and Eastern Europe. The effects are sizeable for older and lowskilled workers.

Cross-border Investment, Heterogeneous Workers, and Employment Security – Evidence from Germany

We analyse how foreign direct investment (FDI) affects employment security using administrative micro data for German employees. FDI intensity is measured at the industry level, which enables us to take into account the sum of direct effects at the investing firms as well as indirect effects of FDI that stem from competitive effects, input-output linkages, technology spillovers, and changes in factor prices. We account for both inward and outward FDI, and differentiate these two types of FDI by source and destination region, respectively. We also investigate whether specific worker groups are affected differently by FDI. We find that both inward and outward FDI at the industry level significantly reduce employment security. This is particularly the case for inward FDI coming from the western part of the European Union, as well as for outward FDI going to Central and Eastern Europe. The effects are quantitatively small overall, but sizeable for some worker groups such as old and low-skilled workers.

Direktinvestitionstätigkeit von Unternehmen – Eine ländervergleichende Analyse zu deren Umfang und eine Bestandsaufnahme ihrer Effekte

Unternehmen nutzen verschiedene Formen der internationalen Vernetzung, angefangen von Exporttatigkeiten uber Kooperationsvertrage bis hin zu Kapitalverflechtungen im Ausland. Kapitalverflechtungen im Ausland stellen aus unternehmensorganisatorischer Sicht die weitreichendste Form der Internationalisierung dar. Nicht zuletzt aufgrund der stetigen Zunahme internationaler Unternehmensverflechtungen stehen Beteiligungserwerbe an bestehenden Unternehmen vermehrt im Blickpunkt der Beschaftigungs- und Wirtschaftspolitik. So wird vielerorts die Sorge geausert, dass die Beteiligung auslandischer Anteilseigner negative Auswirkungen auf die Entwicklung der Zielunternehmen haben konnte. Grund dafur ist die Befurchtung von Rationalisierungsmasnahmen, die mit Ubernahmen einher gehen konnen. Hierzu zahlen einerseits die kurz- und langfristige Freisetzung von Beschaftigten nach Einsparungen redundanter Unternehmensteile, aber auch negative Einflusse auf die Durchfuhrung von Forschung und Entwicklung am Standort des ubernommenen Unternehmens werden befurchtet. Unternehmen unterhalten oft nur eine zentrale Forschungs- und Entwicklungsabteilung, die zumeist mit dem Sitz der Konzernzentrale verbunden ist. Daraus lasst sich die Vermutung ableiten, dass Forschung und Entwicklung am Sitz des ubernommenen Unternehmens reduziert und zum Sitz des Kaufers transferiert wird.