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New firm formation in the wake of mergers and acquisitions: An exploration of push and pull factors

PublicationArticle (with peer review)
acquisitions, Arbetsmarknadsprogrammet, entrepreneurial opportunity, entrepreneurial spawning, firm formation, mergers, Monia Lougui, opportunity costs

Abstract

This study investigates the relationship between mergers and acquisitions (M&A) and entrepreneurial spawning in labour-intensive service sectors. We discuss two sets of theoretical mechanisms. First, M&As may push employees into entrepreneurship by lowering the average barriers of leaving the current employment (i.e. being associated with general deterioration of working conditions). Second, M&A activities may generate new entrepreneurial opportunities, which are first and foremost accessible by employees directly affected by M&As. Results on entrepreneurial spawning in 3,198 Swedish firms during the time period 2000–2009 confirm that the number of firms spawned from a specific incumbent increases following an M&A. Push-oriented factors are found to contribute to this effect, but a dominating part of the total effect remains in the presence of proxies for push-effects. This suggests that pull-oriented explanations of opportunity creation in the wake of M&As constitute an important avenue for further research on the antecedents of new firm formation.

Lougui, M. & Broström, A. (2020). New firm formation in the wake of mergers and acquisitions: An exploration of push and pull factors. Journal of Evolutionary Economics. DOI: 10.1007/s00191-020-00678-4

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New firm formation in the wake of mergers and acquisitions: An exploration of push and pull factors
Artikel (med peer review)Publication
Lougui, M. & Broström, A.
Publication year

2020

Abstract

This study investigates the relationship between mergers and acquisitions (M&A) and entrepreneurial spawning in labour-intensive service sectors. We discuss two sets of theoretical mechanisms. First, M&As may push employees into entrepreneurship by lowering the average barriers of leaving the current employment (i.e. being associated with general deterioration of working conditions). Second, M&A activities may generate new entrepreneurial opportunities, which are first and foremost accessible by employees directly affected by M&As. Results on entrepreneurial spawning in 3,198 Swedish firms during the time period 2000–2009 confirm that the number of firms spawned from a specific incumbent increases following an M&A. Push-oriented factors are found to contribute to this effect, but a dominating part of the total effect remains in the presence of proxies for push-effects. This suggests that pull-oriented explanations of opportunity creation in the wake of M&As constitute an important avenue for further research on the antecedents of new firm formation.

The Effect of Marshallian and Jacobian Knowledge Spillovers on Jobs in the Solar, Wind and Energy Efficiency Sector
Article (with peer review)Publication
Aldieri, L., Grafström, J., & Vinci, C. P.
Publication year

2021

Published in

Energies, 14(14), 4269.

Abstract

The purpose of this paper is to establish if Marshallian and Jacobian knowledge spillovers affect job creation in the green energy sector. Whether these two effects exist is important for the number of jobs created in related fields and jobs pushed away in other sectors. In the analysis, the production efficiency, in terms of jobs and job spillovers, from inventions in solar, wind and energy efficiency, is explored through data envelopment analysis (DEA), based on the Malmquist productivity index, and tobit regression. A panel dataset of American and European firms over the period of 2002–2017 is used. The contribution to the literature is to show the role of the spillovers from the same technology sector (Marshallian externalities), and of the spillovers from more diversified activity (Jacobian externalities). Since previous empirical evidence concerning the innovation effects on the production efficiency is yet weak, the paper attempts to bridge this gap. The empirical findings suggest negative Marshallian externalities, while Jacobian externalities have no statistical impact on the job creation process. The findings are of strategic importance for governments who are developing industrial strategies for renewable energy.

Aldieri, L., Grafström, J., & Vinci, C. P. (2021). The Effect of Marshallian and Jacobian Knowledge Spillovers on Jobs in the Solar, Wind and Energy Efficiency Sector. Energies, 14(14), 4269.

Spin-in and spin-out for growth – On the acquisition and divestiture of high-tech firms
Article (with peer review)Publication
Öberg, C.
Publication year

2021

Abstract

Purpose: This paper describes and discusses company spin-ins and spin-outs as a means to understand company growth in a dynamic context. The following question is asked: How can growth be understood in spin-ins and spin-outs of innovative firms? The paper suggests return on capabilities as a measure to understand growth in an open innovation context.

Design/methodology/approach: The empirical part of the paper consists of a single case study. Data was captured through interviews and secondary data sources.

Findings: The paper points to that resources alone do not explain strategic decisions by a company and how spin-ins and spin-outs result from the need for capabilities, changes in business foci and temporary solutions to deal with overcapacities or lack of alternatives.

Originality/value: The paper contributes to research by discussing contemporary issues in strategy and innovation and relating them to the resource-based view and the growth of the firm. Spin-outs, and acquisitions and divestitures as interlinked events have rarely been focused on in the literature, while they remain frequent phenomena in practice.

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