IDEAS home Printed from https://ideas.repec.org/a/gam/jsusta/v14y2022i3p1206-d730203.html
   My bibliography  Save this article

Does High-Speed Railway Opening Improve the M&A Behavior?

Author

Listed:
  • Lin Han

    (School of Economics and Management, Beijing Jiaotong University, Beijng 100044, China)

  • Xingchan Li

    (School of Economics and Management, Beijing Jiaotong University, Beijng 100044, China)

  • Yanshu Yang

    (School of Economics and Management, Beijing Jiaotong University, Beijng 100044, China)

Abstract

High-speed railway ( HSR ) shortens the spatial and temporal distance between regions and has a profound impact on regional economy and enterprise decision-making. This study investigates the impact of opening a high-speed railway ( HSR ) on enterprises’ mergers and acquisitions ( M&A ) behavior in China. Our findings suggest that the opening of HSR promotes the M&A activities of listed companies, and the opening of non-intercity HSR has a more obvious effect on the promotion of M&A decisions of enterprises. The results were robust after a series of robustness checks. Hence, the spatiotemporal squeezing effect generated by opening an HSR significantly improves the efficiency of information exchange and decreases the transaction costs of listed companies, which greatly promotes the M&A decisions of enterprises.

Suggested Citation

  • Lin Han & Xingchan Li & Yanshu Yang, 2022. "Does High-Speed Railway Opening Improve the M&A Behavior?," Sustainability, MDPI, vol. 14(3), pages 1-22, January.
    • Handle: RePEc:gam:jsusta:v:14:y:2022:i:3:p:1206-:d:730203
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/2071-1050/14/3/1206/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/2071-1050/14/3/1206/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Roberto Ragozzino, 2009. "The Effects of Geographic Distance on the Foreign Acquisition Activity of U.S. Firms," Management International Review, Springer, vol. 49(4), pages 509-535, September.
    2. Krugman, Paul, 1994. "Complex Landscapes in Economic Geography," American Economic Review, American Economic Association, vol. 84(2), pages 412-416, May.
    3. Arturs Kalnins & Francine Lafontaine, 2013. "Too Far Away? The Effect of Distance to Headquarters on Business Establishment Performance," American Economic Journal: Microeconomics, American Economic Association, vol. 5(3), pages 157-179, August.
    4. John, Kose & Knyazeva, Anzhela & Knyazeva, Diana, 2011. "Does geography matter? Firm location and corporate payout policy," Journal of Financial Economics, Elsevier, vol. 101(3), pages 533-551, September.
    5. Jun‐Koo Kang & Jin‐Mo Kim, 2008. "The Geography of Block Acquisitions," Journal of Finance, American Finance Association, vol. 63(6), pages 2817-2858, December.
    6. Xavier Giroud, 2013. "Proximity and Investment: Evidence from Plant-Level Data," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 128(2), pages 861-915.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Xuan Yang & Qiusheng Zhang & Xiaotian Shen & Jie Qin & Qian Sun & Yuanze Xu, 2022. "Could the Opening of HSR Reduce the M&A Premium?," Sustainability, MDPI, vol. 14(10), pages 1-28, May.
    2. Chen, Yunsen & Huang, Jianqiao & Xiao, Sheng & Zhao, Ziye, 2020. "The “home bias” of corporate subsidiary locations," Journal of Corporate Finance, Elsevier, vol. 62(C).
    3. Huang, Xiaoran & Kang, Jun-Koo, 2017. "Geographic concentration of institutions, corporate governance, and firm value," Journal of Corporate Finance, Elsevier, vol. 47(C), pages 191-218.
    4. Huang, Yichu & Fan, Yaoyao, 2022. "Risk along the supply chain: Geographic proximity and corporate risk taking," Finance Research Letters, Elsevier, vol. 50(C).
    5. Chen, Hongwen & Cheng, Ken & Zhang, Meiyang, 2023. "Does geographic proximity affect firms’ cross-regional development? Evidence from high-speed rail construction in China," Economic Modelling, Elsevier, vol. 126(C).
    6. Li, Chao & Li, Han & Zhao, Zhao, 2022. "Geographic proximity and M&As: Evidence from China," Emerging Markets Review, Elsevier, vol. 51(PB).
    7. Li, Wanli & Lai, Yin & Zhong, Yufen, 2024. "The closer the better: Supplier geographic proximity and corporate information disclosure violation," The North American Journal of Economics and Finance, Elsevier, vol. 69(PA).
    8. Feng Huang & Jie Gao, 2022. "Customer and Tax Avoidance: How Does Customer Geographic Proximity Affect a Supplier’s Tax Avoidance?," Sustainability, MDPI, vol. 14(22), pages 1-30, November.
    9. Wu, Yizhong & Lee, Chien-Chiang & Lee, Chi-Chuan & Peng, Diyun, 2022. "Geographic proximity and corporate investment efficiency: Evidence from high-speed rail construction in China," Journal of Banking & Finance, Elsevier, vol. 140(C).
    10. Zhangkai Huang & Jinyu Liu & Guangrong Ma, 2019. "Distance, transportation and the underpricing of IPOs," Review of Quantitative Finance and Accounting, Springer, vol. 52(4), pages 991-1009, May.
    11. P. Charnoz & C. Lelarge & C. Trevien, 2016. "Communication Costs and the Internal Organization of Multi-Plant Businesses: Evidence from the Impact of the French High-Speed Rail," Documents de Travail de l'Insee - INSEE Working Papers g2016-02, Institut National de la Statistique et des Etudes Economiques.
    12. Dasgupta, Sudipto & Chen, Chen & Huynh, Thanh & Xia, Ying, 2020. "Product Market Competition and the Relocation of Economic Activity: Evidence from the Supply Chain," CEPR Discussion Papers 15056, C.E.P.R. Discussion Papers.
    13. Youngho Kang & Jeongmeen Suh, 2022. "Information technology and the spatial reorganization of firms," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 31(3), pages 674-692, August.
    14. Okubo, Toshihiro & Watabe, Yuta, 2023. "Networked FDI and third-country intra-firm trade," International Review of Economics & Finance, Elsevier, vol. 83(C), pages 591-606.
    15. Toshihiro Okubo & Eiichi Tomiura, 2016. "Multi-plant operation and corporate headquarters separation: Evidence from Japanese plant-level," Keio-IES Discussion Paper Series 2016-016, Institute for Economics Studies, Keio University.
    16. Bartelme, Dominick & Ziv, Oren, 2024. "The internal geography of firms," Journal of International Economics, Elsevier, vol. 148(C).
    17. Davide Del Prete & Armando Rungi, 2020. "Backward and Forward Integration Along Global Value Chains," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 57(2), pages 263-283, September.
    18. Anna Gumpert & Henrike Steimer & Manfred Antoni, 2023. "Firm Organization with Multiple Establishments," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 137(2), pages 1091-1138.
    19. Boubakri, Narjess & Guedhami, Omrane & Saffar, Walid, 2016. "Geographic location, foreign ownership, and cost of equity capital: Evidence from privatization," Journal of Corporate Finance, Elsevier, vol. 38(C), pages 363-381.
    20. Bassanini, Andrea & Caroli, Eve & Fontaine, François & Rebérioux, Antoine, 2021. "Escaping social pressure: Fixed-term contracts in multi-establishment firms," Journal of Economic Behavior & Organization, Elsevier, vol. 188(C), pages 697-715.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:gam:jsusta:v:14:y:2022:i:3:p:1206-:d:730203. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.