Using firm-level data on U.S. multinationals, we find that affiliates created for vertical FDI motives seem to be larger and fewer—both within the firm and across affiliates—while affiliates that appear to be created for horizontal FDI motives are smaller and more common. Next, we...

This paper empirically characterizes the matching between firms in domestic and cross-border mergers and acquisitions (M&A). The analysis is guided by a theoretical framework constructed following the premises of the new trade theory. It assumes that firms are heterogeneous, within the industry...