Political Connections and M&As Outcomes: Bibliometric Analysis and Research Agenda

Abstract

Mergers and acquisitions (M&A) are a common strategy to accelerate firms’ growth, but they also carry future risks due to substantial expenditures, uncertain payback, and irreversible nature. This study examines current and future research trends concerning the influence of political connections on M&A by utilizing a systematic literature review and the bibliometric tools CiteSpace and VOSviewer. We examine prominent authors to gain insight into significant contributors and to identify major research domains, know-ledge sources, theories, and keyword trends to uncover primary research themes. Analysis of 308 relevant articles published from 1986 to 2023 reveals a significant growth in publications on this topic, with an increasing focus on emerging countries. Greater attention is paid not only to business and economic areas such as market and financial performance, internationalization, and corporate governance but also to the impact of politically affiliated firms in implementing M&A to help achieve sustainable development goals. The findings of this study offer valuable insights for decision-makers seeking to leverage political connections as a non-market strategy to drive organizational growth. The literature review suggests that managers with political affiliations may enjoy greater access to resources and opportunities for M&A. However, these connections can also facilitate rent-seeking behaviour, undermining government oversight and sustainable M&A practices. Politically connected executives may also face conflicts of interest between the increasing shareholders value and political agendas. In the current climate of deglobalization and protectionism, political connections can serve as either an asset or a liability, especially for state-owned enterprises engaged in cross-border M&A.