What drives emerging economy firm acquisitions in tax havens?


Chari M., Acikgoz S.

JOURNAL OF BUSINESS RESEARCH, cilt.69, ss.664-671, 2016 (SSCI İndekslerine Giren Dergi) identifier identifier

  • Cilt numarası: 69 Konu: 2
  • Basım Tarihi: 2016
  • Doi Numarası: 10.1016/j.jbusres.2015.08.034
  • Dergi Adı: JOURNAL OF BUSINESS RESEARCH
  • Sayfa Sayıları: ss.664-671

Özet

We note that a non-trivial fraction of international acquisitions by emerging economy firms are in tax havens. We argue that such acquisitions are driven by different motivations than the four (market seeking, resource seeking, low cost seeking, and knowledge or strategic asset seeking) identified in the international business literature. Specifically, we argue that such acquisitions are driven by institutional weakness in the home country and lower taxes in the host country. Empirical tests using data on cross border acquisitions by firms from ten emerging economies with the most numbers of cross border acquisitions lend support to our arguments. (C) 2015 Elsevier Inc. All rights reserved.