PRODUCTIVITY AND ACQUISITIONS IN U.S. COAL MINING

David R Merrell

Working Papers from U.S. Census Bureau, Center for Economic Studies

Abstract: This paper extends the literature on the productivity incentives for mergers and acquisitions. We develop a stochastic matching model that describes the conditions under which a coal mine will change owners. This model suggests two empirically testable hypotheses: i. acquired mines will exhibit low productivity prior to being acquired relative to non-acquired mines and ii. extant acquired mines will show post-acquisition productivity improvements over their pre-acquisition productivity levels. Using a unique micro data set on the universe of U.S. coal mines observed from 1978 to 1996, it is estimated that acquired coal mines are significantly less productive than non-acquired mines prior to having been acquired. Additionally, there is observable and significant evidence of post-acquisition productivity improvements. Finally, it is found that having been acquired positively and significantly influences the likelihood that a coal mine fails.

Keywords: CES; economic; research; micro; data; microdata; chief; economist (search for similar items in EconPapers)
Date: 1999-12
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:cen:wpaper:99-17

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