Economics at your fingertips  

Employment Protection and M&A Performance: Evidence from International Data

Kota Iwasaki, Naoshi Ikeda and Kotaro Inoue

Economic Review, 2019, vol. 70, issue 3, 177-199

Abstract: This study empirically examines a hypothesis that, post mergers and acquisitions(M&A)integration, reorganizations and restructurings become difficult when employees of target firms are strongly protected by labor law and regulations in the target countries, affecting both selection of target firms and value creation from the acquisitions. Consistent with the hypothesis, our empirical results show that when employees in the target countries enjoy a strong legal protection, the stock return at the time of deal announcement and the operating performance of the acquirers in the post-acquisition period worsens. The results are robust even when different kinds of indexes of employment protection are used and selection bias of target firms is considered.

JEL-codes: G34 G38 K31 (search for similar items in EconPapers)
Date: 2019
References: Add references at CitEc
Citations: Track citations by RSS feed

Downloads: (external link)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link:

DOI: 10.15057/30486

Access Statistics for this article

More articles in Economic Review from Hitotsubashi University Contact information at EDIRC.
Bibliographic data for series maintained by Digital Resources Section, Hitotsubashi University Library ().

Page updated 2021-08-06
Handle: RePEc:hit:ecorev:v:70:y:2019:i:3:p:177-199