Religion and Cross-Border Mergers and Acquisitions

다국어 초록 (Multilingual Abstract)

This study examines the effect of religion on cross-border mergers and acquisitions (M&As). We measure the religious distance between countries and find that cross-border M&A activity is lower for country pairs with greater religious distance. This finding remains intact after a host of variables affecting M&A activity are controlled for and when instrumental variables are used for religious distance. Moreover, the negative effect of religious distance on cross-border M&A activity is more pronounced if the people living in either the acquirer or target country are more religious. Overall, our results suggest that differences in religious beliefs impose an additional coordination cost on merging firms and thereby inhibit cross-border M&A activity. (JEL G34, Z12)

목차 (Table of Contents)

• Abstract
• 1. Introduction
• 2. Related Literature and Hypothesis Development
• 2.1 Religion and Finance
• 2.2 Religious Differences and Cross-Border Mergers and Acquisitions
• 2.3 Religiosity
• 3. Data and Empirical Methods
• 3.1 Data and Variable Description
• 3.2 Empirical Methods
• 4. Empirical Results
• 4.1 Effect of Religious Differences on Cross-Border M&As
• 4.2. Religiosity and the Effect of Religious Differences on Cross-Border M&As
• 4.3 Robustness Checks
• 5. Concluding Remarks
• Appendix
• References