Robustness

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立 政 治 大 學

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6. Robustness

In this section, we check the robustness of our empirical results based on 2 and 3 digit SIC codes for equations (1.1) and (1.2). Results are shown in Tables 1.5 and 1.6, which confirm the findings in Tables 1.3 and 1.4. The interaction term RelativeHHI × HomeVerticalTarget_t-1, in columns (1) to (4) of Table 1.5, are significantly negative at the one percent level, which provides further empirical support of proposition I that the incentives for cross-border mergers rise with vertical integration when the pre-merger HHI at home is sufficiently low relative to the HHI in the foreign country.

Columns (1) to (4) in Table 1.6 show that the coefficients of RelativeHHI are positively significant.

We also check the robustness of our empirical results using different specifications of target and acquirer market concentration measures in equations (1.3) and (1.4). Instead of using the relative HHI of target and acquirer firms, we use the levels of HHI of target and acquirer firms. Results are shown in Tables 1.7 and 1.8. Results are consistent with what we find in Tables 1.3 and 1.4 using RelativeHHI ratio.

Column (1) in Table 1.7 shows that the interaction term between

HomeVertical and AcquirerHHI indicate that the incentives for cross-border

mergers rise with vertical integration when the pre-merger HHI in the foreign country is high. The findings in columns (1) to (4) are consistent with results in Table 1.4 and provide further empirical support for proposition II.

CrossBorder

it

=α+𝛿

1

HomeVertical

Target_t-1,i.t

+𝛿

2

TargetHHI

_𝑖.𝑡

+𝛿

3

AcquirerHHI

_𝑖.𝑡

+𝛿

₄

HomeVertical

_Target

t-1,i.t× TargetHHI_𝑖.𝑡

+𝛿

5

HomeVertical

Target_t-1,i.t× AcquirerHHI_𝑖.𝑡

+𝛿

6

LogDistance

_i.t

+𝛿

7

LogMktSize_Ratio

_i.t

+𝛿

8

Target_CountrySkill

_i.t

+𝛿

9

Target_IndustrySkill

_i.t

+𝛿

10

Target_CountrySkill

_i.t× Target_IndustrySkill_i.t

+𝛿

11

Acquirer_CountrySkill

_i.t

+𝛿

12

Acquirer_IndustrySkill

_i.t

+𝛿

13

Acquirer_CountrySkill

_i.t× Acquirer_IndustrySkill_i.t+ 𝜀_𝑖,𝑡

(1.3)

CrossBorder × HomeVertical

Target_t-1,i.t

=α+𝜃

1

TargetHHI

_𝑖.𝑡

+𝜃

2

AcquirerHHI

_𝑖.𝑡

+𝜃

3

LogDistance

_i.t

+𝜃

4

LogMktSize_Ratio

_i.t

+𝜃

8

Target_CountrySkill

_i.t

+𝜃

9

Target_IndustrySkill

_i.t

+𝜃

10

Target_CountrySkill

_i.t× Target_IndustrySkill_i.t

+𝜃

11

Acquirer_CountrySkill

_i.t

+𝜃

12

Acquirer_IndustrySkill

_i.t

+𝜃

13

Acquirer_CountrySkill

_i.t× Acquirer_IndustrySkill_i.t+ 𝜀_𝑖,𝑡

(1.4)

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Table 1.5 Robustness check: SIC-Based Classification of the Determinant of Cross-Border M&As in Oligopoly Industry.

We estimate the following logit regression model:

CrossBorder_it=α+β₁RelativeHHI_i.t+β₂HomeVertical_{Targett-1,i.t} +β₃RelativeHHI_i.t× HomeVertical_{Targett-1,i.t} +β₄LogDistance_i.t+β₅LogMktSize_Ratio_i.t

+β₆CountrySkill_Ratio_i.t+β₇IndustrySkill_Ratio_i.t +β₈CountrySkill_Ratio_i.t× IndustrySkill_Ratio_i.t+ 𝜀𝑖,𝑡

(1.1) This table presents marginal effects for the logit model of Equation (1.1). The dependent variable CrossBorder equals one for cross-border deal and zero otherwise. Columns (1) and (2) use SIC-Based 2-digit classification, while columns (3) and (4) use SIC-Based 2-digit classification. HomeVertical equals one for targets that were vertical merged at domestic market and zero otherwise. RelativeHHI is defined as the ratio (Target_HHI/Acquirer_HHI).

Target_HHI is the Herfindahl Index of target’s industry. Acquirer_HHI is the Herfindahl Index of acquirer’s industry.

Our Control variables in this model are: Distance is the bilateral distance between target and acquirer country. MarketSize is the GDP per capita in U.S. dollars. MarketSize_Ratio is defined as the ratio (Target_LogMarketSize/Acquirer LogMarketSize). CountrySkill is the high school enrollment years of schooling per worker. CountrySkill_Ratio is defined as the ratio (TargetCountry_Skill/AcquirerCountry_Skill). IndustrySkill is the number of workers in the industry (Unit: Thousand). IndustrySkill_Ratio is defined as the ratio (TargetIndustry_Skill/AcquirerIndustry_Skill). Country_Skill_Ratio×IndustrySkill_Ratio is defined as the interaction term between CountrySkill and IndustrySkill ratio. Proximity is a ratio of the direct to the total inputs used by the firm. Closeness is the absolute difference if four-digit SIC between target and acquirer. The data sources and definitions of the variables are provided in Appendix 1.A. The marks a, b, and c indicate significance at the 1%, 5%, and 10% level, respectively.

Independent variables

Dependent variable: CrossBorder

SIC-Based 2 digit SIC-Based 3 digit

Column (1) Column (2) Column (3) Column (4) Coeff p-val. Coeff p-val. Coeff p-val. Coeff p-val.

HomeVertical -0.311b (0.015) -0.272b (0.036) -0.242 (0.051) -0.210 (0.095) RelativeHHI 0.125a (0.000) 0.136a (0.000) 0.158a (0.000) 0.167a (0.000) HomeVertical×RelativeHHI -0.164a (0.006) -0.165a (0.006) -0.223a (0.000) -0.224a (0.000) LogDistance 0.978a (0.000) 0.979a (0.000) 0.975a (0.000) 0.976a (0.000) LogMaketSize_Ratio 1.244 (0.187) 1.309 (0.174) 1.307 (0.171) 1.371 (0.162) CountrySkill_Ratio 1.238a (0.002) 1.154a (0.005) 1.211a (0.003) 1.133a (0.006) IndustrySkill_Ratio 0.007 (0.342) 0.006 (0.374) 0.007 (0.342) 0.006 (0.368) CountrySkill_Ratio×IndustrySkill_Ratio -0.005 (0.472) -0.004 (0.529) -0.005 (0.465) -0.005 (0.516)

Proximity 1.648a (0.000) 1.663a (0.000)

Closeness -0.076 (0.368) -0.054 (0.522)

Constant -10.42a (0.000) -10.53a (0.000) -10.45a (0.000) -10.57a (0.000)

Observations 3,895 3,895 3,895 3,895

Pseudo R² 0.1685 0.1722 0.1718 0.1754

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立 政 治 大 學

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17

Table 1.6 Robustness check: SIC-Based Classification of the Determinant of Cross-Border Home Vertical M&As in Oligopoly Industry.

We estimate the following logit regression model:

CrossBorder × HomeVertical_{Targett-1,i.t}

=α+𝛾₁RelativeHHI_i.t+𝛾₂LogDistance_i.t+𝛾₃LogMktSize_Ratio_i.t +𝛾4CountrySkill_Ratio_i.t+𝛾₅IndustrySkill_Ratio_i.t

+𝛾₆CountrySkill_Ratio_i.t× IndustrySkill_Ratio_i.t+ 𝜀_𝑖,𝑡

(1.2) This table presents marginal effects for the logit model of Equation (1.2). The dependent variables CrossBorder×HomeVertical is the interaction term between CrossBorder and HomeVertical. CrossBorder is a dummy variable, which equals to one if the M&A is cross-border deal and zero otherwise. HomeVertical is a dummy variable, which equals to one if the target has been vertical integrated at home market and zero otherwise. Columns (1) and (2) use SIC-Based 2-digit classification, while columns (3) and (4) use SIC-Based 2-digit classification. RelativeHHI is defined as the ratio (Target_HHI/Acquirer_HHI).

Target_HHI is the Herfindahl Index of target’s industry. Acquirer_HHI is the Herfindahl Index of acquirer’s industry.

Our Control variables in this model are: Distance is the bilateral distance between target and acquirer country. MarketSize is the GDP per capita in U.S. dollars. MarketSize_Ratio is defined as the ratio (Target_LogMarketSize/Acquirer LogMarketSize). CountrySkill is the high school enrollment years of schooling per worker. CountrySkill_Ratio is defined as the ratio (TargetCountry_Skill/AcquirerCountry_Skill). IndustrySkill is the number of workers in the industry (Unit: Thousand). IndustrySkill_Ratio is defined as the ratio (TargetIndustry_Skill/AcquirerIndustry_Skill). Country_Skill_Ratio×IndustrySkill_Ratio is defined as the interaction term between CountrySkill and IndustrySkill ratio. Proximity is a ratio of the direct to the total inputs used by the firm. Closeness is the absolute difference if four-digit SIC between target and acquirer. The data sources and definitions of the variables are provided in Appendix 1.A. The marks a, b, and c indicate significance at the 1%, 5%, and 10% level, respectively.

Independent variables

Dependent variable: CrossBorder × HomeVerticalTarget_t-1,i.t

SIC-Based 2 digit SIC-Based 3 digit

Column (1) Column (2) Column (3) Column (4) Coeff p-val. Coeff p-val. Coeff p-val. Coeff p-val.

RelativeHHI 0.261a (0.000) 0.279a (0.000) 0.277a (0.000) 0.290a (0.000) LogDistance 1.002a (0.000) 0.997a (0.000) 0.995a (0.000) 0.989a (0.000) LogMaketSize_Ratio -0.857b (0.015) -0.864b (0.015) -0.951a (0.008) -0.953a (0.008) CountrySkill_Ratio 2.488a (0.000) 2.487a (0.000) 2.478a (0.000) 2.478a (0.000) IndustrySkill_Ratio -0.004 (0.465) -0.004 (0.478) -0.005 (0.358) -0.005 (0.368) CountrySkill_Ratio×IndustrySkill_Ratio 0.004 (0.453) 0.004 (0.472) 0.005 (0.347) 0.005 (0.358)

Proximity 1.320a (0.000) 1.289a (0.000)

Closeness -0.008 (0.818) 0.011 (0.772)

Constant -9.765a (0.000) -9.813a (0.000) -9.592a (0.000) -9.649a (0.000)

Observations 3,895 3,895 3,895 3,895

Pseudo R² 0.1777 0.1796 0.1775 0.1792

‧

Table 1.7 Robustness check: Additional tests on the Determinant of Cross-Border M&As in Oligopoly Industry.

We estimate the following logit regression model:

CrossBorder_it=α+𝛿₁HomeVertical_{Targett-1,i.t}+𝛿2TargetHHI_𝑖.𝑡+𝛿3AcquirerHHI_𝑖.𝑡 +𝛿4HomeVertical_{Targett-1,i.t}× TargetHHI_𝑖.𝑡

+𝛿5HomeVertical_{Targett-1,i.t}× AcquirerHHI_𝑖.𝑡 +𝛿6LogDistance_i.t+𝛿7LogMktSize_Ratio_i.t

+𝛿8Target_CountrySkill_i.t+𝛿9Target_IndustrySkill_i.t +𝛿10Target_CountrySkill_i.t× Target_IndustrySkill_i.t +𝛿11Acquirer_CountrySkill_i.t+𝛿12Acquirer_IndustrySkill_i.t +𝛿13Acquirer_CountrySkill_i.t× Acquirer_IndustrySkill_i.t+ 𝜀𝑖,𝑡

(1.3) This table presents marginal effects for the logit model of Equation (1.3). The dependent variables CrossBorder×HomeVertical is the interaction term between CrossBorder and HomeVertical. CrossBorder is a dummy variable, which equals to one if the M&A is cross-border deal and zero otherwise. HomeVertical is a dummy variable, which equals to one if the target has been vertical integrated at home market and zero otherwise. Columns (1) and (2) use IO-based 1% cut-off point, while columns (3) and (4) use IO-based 5% cut-off point. HomeVertical equals one for targets that were vertical merged at domestic market and zero otherwise. RelativeHHI is defined as the ratio (Target_HHI/Acquirer_HHI). Target_HHI is the Herfindahl Index of target’s industry. Acquirer_HHI is the Herfindahl Index of acquirer’s industry.

Our Control variables in this model are: Distance is the bilateral distance between target and acquirer country. MarketSize is the GDP per capita in U.S. dollars. MarketSize_Ratio is defined as the ratio (Target_LogMarketSize/Acquirer LogMarketSize). CountrySkill is the high school enrollment years of schooling per worker. CountrySkill_Ratio is defined as the ratio (TargetCountry_Skill/AcquirerCountry_Skill). IndustrySkill is the number of workers in the industry (Unit: Thousand). IndustrySkill_Ratio is defined as the ratio (TargetIndustry_Skill/AcquirerIndustry_Skill). Country_Skill_Ratio×IndustrySkill_Ratio is defined as the interaction term between CountrySkill and IndustrySkill ratio. Proximity is a ratio of the direct to the total inputs used by the firm. Closeness is the absolute difference if four-digit SIC between target and acquirer. The data sources and definitions of the variables are provided in Appendix 1.A. The marks a, b, and c indicate significance at the 1%, 5%, and 10% level, respectively.

Independent variables

Dependent variable: CrossBorder

IO-Based 1% cutoff IO-Based 5% cutoff

Column (1) Column (2) Column (3) Column (4) Target_CountrySkill 0.803a (0.000) 0.796a (0.000) 0.815a (0.000) 0.806a (0.000) Target_IndustrySkill 0.0106 (0.646) 0.0118 (0.610) 0.011 (0.638) 0.012 (0.596) Target_(CountrySkill×IndustrySkill) -0.002 (0.555) -0.002 (0.516) -0.002 (0.555) -0.002 (0.516) Acquirer_CountrySkill 0.894a (0.000) 0.890a (0.000) 0.901a (0.000) 0.897a (0.000) Acquirer_IndustrySkill 0.036b (0.019) 0.035b (0.020) 0.035b (0.019) 0.035b (0.020) Acquirer_(CountrySkill×IndustrySkill) -0.005b (0.031) -0.005b (0.032) -0.005b (0.032) -0.005b (0.032)

Proximity 1.316a (0.008) 1.488a (0.003)

Closeness -0.035 (0.719) -0.087 (0.363)

Constant -24.10a (0.000) -24.16a (0.000) -24.37a (0.000) -24.43a (0.000)

Observations 3,655 3,655 3,655 3,655

Pseudo R2 0.3127 0.3144 0.3077 0.3102

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立 政 治 大 學

‧

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Table 1.8 Robustness check: Additional tests of the Determinant of Cross-Border Home Vertical M&As in Oligopoly Industry.

We estimate the following logit regression model:

CrossBorder × HomeVertical_{Targett-1,i.t}=α+𝜃1TargetHHI_𝑖.𝑡+𝜃2AcquirerHHI_𝑖.𝑡 +𝜃3LogDistance_i.t+𝜃4LogMktSize_Ratio_i.t

+𝜃8Target_CountrySkill_i.t+𝜃9Target_IndustrySkill_i.t +𝜃10Target_CountrySkill_i.t× Target_IndustrySkill_i.t +𝜃11Acquirer_CountrySkill_i.t+𝜃12Acquirer_IndustrySkill_i.t +𝜃13Acquirer_CountrySkill_i.t× Acquirer_IndustrySkill_i.t+ 𝜀𝑖,𝑡

(1.4) This table presents marginal effects for the logit model of Equation (1.4). The dependent variables CrossBorder×HomeVertical is the interaction term between CrossBorder and HomeVertical. CrossBorder is a dummy variable, which equals to one if the M&A is cross-border deal and zero otherwise. HomeVertical is a dummy variable, which equals to one if the target has been vertical integrated at home market and zero otherwise. Columns (1) and (2) use IO-based 1% cut-off point, while columns (3) and (4) use IO-based 5% cut-off point. HomeVertical equals one for targets that were vertical merged at domestic market and zero otherwise. RelativeHHI is defined as the ratio (Target_HHI/Acquirer_HHI). Target_HHI is the Herfindahl Index of target’s industry. Acquirer_HHI is the Herfindahl Index of acquirer’s industry.

Our Control variables in this model are: Distance is the bilateral distance between target and acquirer country. MarketSize is the GDP per capita in U.S. dollars. MarketSize_Ratio is defined as the ratio (Target_LogMarketSize/Acquirer LogMarketSize). CountrySkill is the high school enrollment years of schooling per worker. CountrySkill_Ratio is defined as the ratio (TargetCountry_Skill/AcquirerCountry_Skill). IndustrySkill is the number of workers in the industry (Unit: Thousand). IndustrySkill_Ratio is defined as the ratio (TargetIndustry_Skill/AcquirerIndustry_Skill). Country_Skill_Ratio×IndustrySkill_Ratio is defined as the interaction term between CountrySkill and IndustrySkill ratio. Proximity is a ratio of the direct to the total inputs used by the firm. Closeness is the absolute difference if four-digit SIC between target and acquirer. The data sources and definitions of the variables are provided in Appendix 1.A. The marks a, b, and c indicate significance at the 1%, 5%, and 10% level, respectively.

Independent variables

Dependent variable: CrossBorder × HomeVerticalTarget_t-1,i.t

IO-Based 1% cutoff IO-Based 5% cutoff

Column (1) Column (2) Column (3) Column (4) Coeff p-val. Coeff p-val. Coeff p-val. Coeff p-val.

TargetHHI 1.454a (0.000) 1.455a (0.000) 1.455a (0.000) 1.457a (0.000) AcquirerHHI 0.600a (0.000) 0.613a (0.000) 0.575a (0.000) 0.589a (0.000) LogDistance 1.378a (0.000) 1.369a (0.000) 1.377a (0.000) 1.367a (0.000) Target_LogMaketSize -0.223a (0.000) -0.223a (0.000) -0.244a (0.000) -0.244a (0.000) Acquirer_LogMaketSize 0.310a (0.000) 0.308a (0.000) 0.321a (0.000) 0.319a (0.000) Target_CountrySkill 0.811a (0.000) 0.808a (0.000) 0.811a (0.000) 0.808a (0.000) Target_IndustrySkill -0.012c (0.093) -0.012c (0.089) -0.011 (0.114) -0.011 (0.112) Target_(CountrySkill×IndustrySkill) 0.002 (0.119) 0.002 (0.112) 0.001 (0.144) 0.002 (0.139) Acquirer_CountrySkill 0.713a (0.000) 0.705a (0.000) 0.711a (0.000) 0.703a (0.000) Acquirer_IndustrySkill 0.020a (0.003) 0.021a (0.003) 0.019a (0.006) 0.019a (0.007) Acquirer_(CountrySkill×IndustrySkill) -0.003a (0.003) -0.003a (0.003) -0.003a (0.007) -0.003a (0.007)

Proximity 1.011a (0.000) 1.049a (0.000)

Closeness 0.076c (0.066) 0.077c (0.067)

Constant -21.98a (0.000) -21.95a (0.000) -21.85a (0.000) -21.82a (0.000)

Observations 3,655 3,655 3,655 3,655

Pseudo R2 0.2897 0.2906 0.2907 0.2917

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立 政 治 大 學

‧

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20

在文檔中 公司財務決策論文兩篇:跨國購併目標公司之選擇以及聯貸市場參貸銀行的選擇 - 政大學術集成 (頁 25-30)