Employee Productivity, Employment Growth, and the Cross-Border Acquisitions by Emerging Market Firms

Ataullah, Ali; Le, Hang and Sahota, Amandeep S. (2014). Employee Productivity, Employment Growth, and the Cross-Border Acquisitions by Emerging Market Firms. Human Resource Management, 53(6) pp. 987–1004.

DOI: https://doi.org/10.1002/hrm.21619

Abstract

We examine the impact of the cross-border acquisitions made by firms from emerging markets on employee productivity and employment growth. The literature suggests that cross-border acquisitions enable emerging market firms to obtain new skills and knowledge-intensive assets, which, in turn, may increase productivity. However, our empirical analysis suggests that cross-border acquisitions reduce employee productivity and have a limited impact on employment growth. Moreover, we find that cross-border acquisitions in less-developed countries and in culturally distinct countries reduce productivity. Overall, our findings cast doubt on the idea that cross-border acquisitions enable emerging market firms to improve the productivity of one of their most important resources—namely, their human capital.