Conference Agenda

This study examines the intersection of political connections, financial slack, and state ownership in influencing cross-border mergers and acquisitions decisions (CBM&A), using data from 3,248 Chinese listed firms during 2006-2017. Based on transaction cost theory, our paper demonstrates that political connections generally increase the transaction costs of CBM&A and decrease firms' propensity for it. This negative impact is mitigated by the presence and interplay of financial slack and state ownership. The findings reveal that, while political connections can constrain international expansion, financial slack and state ownership can alleviate these constraints, offering new insights into the alignment of non-market and market strategies.

In this study, we examine how home-host country geopolitics shapes the FDI strategies of multinational enterprises (MNEs) by investigating the interplay of political capabilities when the past converges with the present in South-South geopolitics. Through a logistic regression analysis of 549 greenfield investments from 2003 to 2019, our research reveals that MNEs leverage their political capabilities when investing in host countries that share a colonial history with the home country. Interestingly, if contemporary geopolitics are favorable in these countries, MNEs can reduce reliance on their political capabilities to pursue South-South FDI. This paper contributes to the international business-international relations interface by showing the contrasting value of historical geopolitics and present-day geopolitical landscapes in the global South context. We offer a firm-level perspective that expands the debate on political capabilities as a complementary factor for past geopolitics and a less crucial factor in the presence of good home-host country contemporary geopolitics.

The extant literature has shown that Non-Market Strategy (NMS) provides firms with political leverage for tax aggressive practices. There is little evidence, however, on how NMS is used to deliver on tax sheltering agenda. This paper investigates this issue from the perspective of Multinational Companies, NMS – tax aggressiveness relationship. We utilise Hillman and Hitt (1999) political formulation framework (Relational versus Transactional) to study 480 corporations’ political encounters with the UK Government from 2012 to 2019 and Probit models are used to empirically test the hypotheses. We find that under the UK institutional setting, Tax haven use prevails among politically active firms and relational approach provides favourable political conditions to operationalise tax sheltering strategies. We also find that older firms' pursuit Relational approach and firms with greater intangibles Transactional approach to deliver on tax aggressive agenda

This study quantifies the impact of the global minimum corporate tax rate, a pillar of the OECD’s reform of international taxation, on cross-border mergers and acquisitions (M&As) involving large multinational enterprises (MNEs). How do differences in capital taxation relate to bilateral cross-border M&As when adopting a gravity model? We apply the resulting estimated coefficients to evaluate the impact of a 15% global minimum tax rate on cross-border investments by firms whose revenue exceeds €750 million whenever the target country's corporate tax rate is lower than 15%. The study exploits a large purpose-built dataset comprising 13,562 investor-firm M&As data points from 2001 to 2020, related to 516 industries defined at the 4-digit level of the NACE Revision 2 classification in 109 'source' countries and 559 industries (defined at the same level of detail) in 161 'target' countries. The empirical results suggest that M&As flows are higher when the source and target countries have similar tax rates, while the overall effect of the global minimum corporate tax on M&As flows would be negative, but small in magnitude.