Corporate ownership transfer and urban economic growth: A study of manufacturing M&As in China

IF 2.4 3区经济学 Q2 ECONOMICS

Papers in Regional Science Pub Date : 2025-02-01 DOI:10.1016/j.pirs.2024.100071

Shuai Shi , Siu Kei Wong , Will W. Qiang , Chen Zheng

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引用次数: 0

Abstract

Mergers & Acquisitions (M&As) are strategic business transactions that combine the ownership of one firm with another, typically to achieve synergies, growth, and diversification. However, the spatial implications of transferring corporate control between cities have been largely overlooked. This article examines the impact of such spatial transfer on urban economic growth, focusing on the restructuring of the manufacturing industry in China. Three types of M&As are distinguished: horizontal, vertical, and conglomerate. Drawing on an instrumental variable analysis of 10,316 M&A transactions from 2004 to 2018, we find that vertical M&As that integrate the supply chain foster urban economic growth, while conglomerate M&As that diversify into unrelated businesses have a negative impact. Furthermore, based on the network properties of M&A flows, the positive effects of vertical M&As is stronger for acquirer cities compared to receiver cities, highlighting the need for place-based financial regulations to address regional disparities in China.

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来源期刊

Papers in Regional Science Multiple-

CiteScore

4.40

自引率

4.80%

发文量

期刊介绍： Regional Science is the official journal of the Regional Science Association International. It encourages high quality scholarship on a broad range of topics in the field of regional science. These topics include, but are not limited to, behavioral modeling of location, transportation, and migration decisions, land use and urban development, interindustry analysis, environmental and ecological analysis, resource management, urban and regional policy analysis, geographical information systems, and spatial statistics. The journal publishes papers that make a new contribution to the theory, methods and models related to urban and regional (or spatial) matters.