Djankov, SimeonFreund, Caroline2015-01-222015-01-222000-09https://hdl.handle.net/10986/21334Using data on mergers and acquisitions involving Korean firms, the authors identify which sectors and firms attracted foreign investment after the liberalization of investment of activity at the end of 1997. They find that domestic acquisitions are similar to foreign acquisitions by sector (of both the target and the acquiring firm), but that international transactions are larger than Korean transactions. This suggests that consolidation is a two-stage process: Firms consolidate first domestically, then internationally. The authors also find that foreign investment is focused on high-value-added sectors, on larger and more profitable firms, on firms with low debt, and on firms that export a large share of output. Their results suggest that growth induces foreign investment.en-USCC BY 3.0 IGOaccess to capitalassetsBanking Systemsbankruptcybiddersbook valueCollective Actioncomparative advantageCurrency CrisesdebtDevelopment Economicsdomestic firmsdomestic investmentdomestic investorsEconomic GrowthEconomic Policyeconomies of scaleemerging marketsexport shareFair TradeFDIfinancial crisisfinancial datafinancial informationFinancial SectorFinancial Structurefirm sizeforeign capitalforeign direct investmentforeign firmforeign firmsforeign investmentforeign investorforeign investorsForeign ownershipGlobal Economyglobal marketsgrowth potentialGrowth RateGrowth Theoryhost countryhost-countryhuman capitalindustrial distributionIndustrial EconomicsInternational Economicsinternational investorsinternational marketsInternational Tradeinvestment activitylabor productivitylocal firmslocal marketMedicinemergersmultinational companiesMultinational Enterprisesnational economiesportfolioportfolio investmentproduction functionproductivityproductivity growthprofitabilityProgramsSafety NetsStandard errorsstatementsTakeovertax incentivestechnology diffusiontechnology transferTelecommunicationsTrade Effectstransaction valuetransport costsTransport EquipmentValue Addedworld industryWorld Investment MergersForeign investmentValue addedForeign ownershipForeign direct investmentsLocation factorsTransport costsTechnological capacityBrand nameMarketingAccess to capital marketsCorporate debtExport capacityCorporate profits10.1596/1813-9450-2450