THE NUMBER OF FOREIGN ACQUISITIONS OF U.S. AGRIBUSINESS FIRMS HAS INCREASED DRAMATICALLY OVER THE LAST TWO DECADES. MANY FOREIGN COMPANIES, ESPECIALLY FROM EMERGING ECONOMIES, SUCH AS CHINA, HAS EXPRESSED AND CONTINUE TO EXPRESS INTEREST IN ACQUIRING WELL-KNOWN AND ESTABLISHED U.S.-BASED AGRIBUSINESSES. POLICY-MAKERS AND REGULATORS ARE INCREASINGLY MORE CONCERNED, ESPECIALLY WHEN ACQUISITIONS TAKE PLACE IN SENSITIVE SECTORS, SUCH AS THE AGRI-FOOD INDUSTRY. THERE IS LITTLE RESEARCH EVALUATING THE IMPACTS OF FOREIGN MERGERS AND ACQUISITIONS (M&AS), ESPECIALLY FROM EMERGING ECONOMIES (E.G., CHINA, INDIA, BRAZIL), ON LOCAL EMPLOYMENT, OUTPUT, PRICE (VOLATILITY), AND TRADE. OUR PROPOSAL SEEKS TO FILL THIS GAP BY COLLECTING A COMPREHENSIVE DATASET ON FOREIGN M&AS AND DOMESTIC ECONOMIC INDICATORS, AND THEN PROVIDING ESTIMATES OF THE IMPACT OF SUCH ACQUISITIONS (FROM EMERGING MARKETS AND ELSEWHERE) ON DOMESTIC EMPLOYMENT, OUTPUT, PRICE VOLATILITY, AND TRADE IN ALL SECTORS (BUT ESPECIALLY IN THE AGRIFOOD SECTOR). OUR EMPIRICAL METHODS WILL RELY ON APPROPRIATELY SPECIFIED ECONOMETRIC MODELS AND RIGOROUS ESTIMATION METHODS THAT WOULD ALLOW US TO IDENTIFY THE CAUSAL EFFECTS OF FOREIGN M&AS (E.G., OLS, DIFFERENCE-IN-DIFFERENCES, 2SLS, CONTROL FUNCTION, AND GMM APPROACHES). THE LONG TERM GOAL OF THE PROJECT IS TO HELP GUIDE POLICY-MAKERS IN THEIR DISCUSSIONS AND POTENTIAL REGULATION OF FOREIGN MERGERS AND ACQUISITIONS IN THE U.S. AGRIFOOD INDUSTRY.

North Carolina State University, Raleigh NC

Investigators