CROSS-BORDER ACQUISITIONS VERSUS DOMESTIC ACQUISITIONS –

In recent last years cross-border acquisitions have been placed in the centre of the present research agenda on Transnational Corporations (TNCs). In this context an important issue is the comparison between cross-border and domestic acquisitions. Among other things, such comparisons demonstrate potential differences in the characteristics of the respective investment modes. It is usual to consider the relative merits of such competing investment modes from the perspective of the TNCs. There is little research on the respective merits from the perspective of a small host economy. The evidence on the effects of these investment modes on industrial restructuring and competition is scarce and less than conclusive. The present study is designed to provide additional information for the case of a small open economy, using logit regression models. The focus is on Greece and draws on both industrial organization (IO) and oligopolistic Foreign Direct Investment (FDI) theory. The results indicate that the different investment forms do have multidimensional structural repercussions, which create multiple entrepreneurial gaps within the national industry. These results have important implications for industrial and competition policy