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Mergers and Acquisitions

The Innovation Impact

Edited by Bruno Cassiman and Massimo G. Colombo

This book examines the issue of mergers and acquisitions (M & As) in the context of technological development, and in particular the impact of M & As on the innovation process. In so doing, the book integrates two bodies of literature, on M & As, and on innovation studies, a nexus which the editors contend represents an important step in the advancement of our understanding of both with clear implications for competitive advantage and growth of firms. Drawing on perspectives from both management and economics, the book offers a cohesive blend of theory, methodology, and a wealth of empirical material.
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Chapter 7: The Sample of M & A: Descriptive Statistics

Massimo G. Colombo and Paola Garrone


7. The sample of M&A: descriptive statistics Massimo G. Colombo and Paola Garrone 7.1 INTRODUCTION This chapter illustrates the main characteristics of the mergers and acquisitions (M&A) sample that offers the basis for an empirical analysis in Chapter 8. The following sections of the chapter will analyse the sample distribution along a restricted number of dimensions. A fruitful departure point is a synthetic discussion of the distinctive characteristics of our sample with respect to previous empirical analyses. The existing large scale studies have enlightened selected aspects of the relationship between M&A and research and development (R&D) activities, but they fail to converge to a consistent empirical pattern (see Chapter 4). We contend that a major limitation of this research stream is its reliance on public innovation indicators at the firm level, such as annual R&D expenditures, patent or new product counts (e.g. Ravenscraft and Scherer 1987, Hall 1990, Hitt et al. 1991, Hitt et al. 1996 and Ahuja and Katila 2001). First, acquisitive events may affect single business units of the merging firms; in addition, they are likely to act differently at different stages of the innovation process. In this respect, standardized innovation measures may allow estimates of changes occurring in the firm-level R&D outputs and inputs, but they cannot illustrate how M&A modify the R&D activities within the firm. Secondly, even in the class of horizontal M&A (the most widely explored type), individual deals may di...

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