Employment growth following takeovers

Karen Geurts and Johannes Van Biesebroeck

No 590697, Working Papers of Department of Economics, Leuven from KU Leuven, Faculty of Economics and Business (FEB), Department of Economics, Leuven

Abstract: We use a comprehensive sample of takeovers in Belgium to show that they are remarkably common and an important part of many firms’ growth process. They affect both small and large firms and, over a five-year period, 17 percent of private employment. We estimate the impact of takeovers on employment growth of the merged entity using an empirical framework that explicitly takes into account that mergers are formed by pairs of firms. It allows for post-merger employment outcomes that are heterogeneous and determined jointly by the characteristics of both partners. The average merger is estimated to reduce employment by 8% over a four-year period, but the contraction can be three times as large for some types of mergers, while employment expands for other types.

Date: 2017-08
New Economics Papers: this item is included in nep-cse
Note: paper number DPS 17.12
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Published in CES. Discussion paper series,, pages 1-52

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Related works:
Journal Article: Employment growth following takeovers (2019)
Working Paper: Employment growth following takeovers (2017)
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Persistent link: https://EconPapers.repec.org/RePEc:ete:ceswps:590697

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