Four Studies on Antitrust Enforcement and Foreign Investment Activities

Nan Zhang

doi:10.46697/001c.30111

Abstract

Motivated by the potential for antitrust policy to contribute to de-globalization by deterring FDI, my dissertation studies how MNEs respond to the increased antitrust enforcement when engaging in foreign investment activities after the global financial crisis of 2008. I employ multi-level data on U.S. antitrust enforcement (industry-level), inward-FDI (industry-level), cross-border M&As (firm-level), and Greenfield FDI (firm-level) in the U.S. markets over 2002–2017 for empirical testing. The findings support my theoretical priors that U.S. antitrust enforcement increases after the global financial crisis, deters aggregated inward-FDI and foreign-acquirer-presence in local M&A markets, and attracts Greenfield FDI.

Highlights

What drives de-globalization? How can the policy factors affect cross-national investing activities? In other words, how do MNEs respond to the increased antitrust enforcement when engaging in foreign investment activities after the global financial crisis of 2008? My dissertation attempts to answer these questions by explaining the influence of antitrust policy on foreign investments, which contributes to the change of the global economic landscape after the financial crisis of 2008
Responding to calls to systematic study antitrust enforcement on foreign investment, my dissertation addresses the following research questions: (1) How has antitrust enforcement changed after the global financial crisis of 2008?; (2) How does antitrust enforcement affect inward FDI?; (3) How does antitrust enforcement affect foreign Mergers and Acquisitions (M&A) in local markets?; and (4) How does antitrust enforcement affect cross-border horizontal M&As, non-horizontal M&As, and Greenfield FDI differently?
Protectionist U.S antitrust policy contradicts the spirit behind the consumer-welfare criterion that is written and codified into U.S antitrust law

Summary

Four Studies on Antitrust Enforcement and Foreign Investment Activities

Motivated by the potential for antitrust policy to contribute to de-globalization by deterring FDI, my dissertation studies how MNEs respond to the increased antitrust enforcement when engaging in foreign investment activities after the global financial crisis of 2008. I employ multi-level data on U.S antitrust enforcement (industry-level), inward-FDI (industry-level), cross-border M&As (firm-level), and Greenfield FDI (firm-level) in the U.S markets over 2002–2017 for empirical testing. The findings support my theoretical priors that U.S antitrust enforcement increases after the global financial crisis, deters aggregated inward-FDI and foreign-acquirer-presence in local M&A markets, and attracts Greenfield FDI

INTRODUCTION

CHANGED AFTER THE GLOBAL FINANCIAL

AFFECT INWARD FDI AT AN AGGREGATED

AFFECT FOREIGN PRESENCE IN THE LOCAL

CONCLUSION