Empirical Evidence of Overbidding in M&A Contests

Eric de Bodt, Jean-Gabriel Cousin () and Richard Roll
Additional contact information
Jean-Gabriel Cousin: Université de Lille

Post-Print from HAL

Abstract: Surprisingly few papers have attempted to develop a direct empirical test for overbidding in merger and acquisition contests. We develop such a test grounded on a necessary condition for profit-maximizing bidding behavior. The test is not subject to endogeneity concerns. Our results strongly support the existence of overbidding. We provide evidence that overbidding is related to conflicts of interest, but also some indirect evidence that it arises from failing to fully account for the winner's curse.

Date: 2018-08-06
References: Add references at CitEc
Citations: View citations in EconPapers (1)

Published in Journal of Financial and Quantitative Analysis, 2018, 53 (4), pp.1547-1579. ⟨10.1017/S0022109018000273⟩

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

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: https://EconPapers.repec.org/RePEc:hal:journl:hal-04408109

DOI: 10.1017/S0022109018000273

Access Statistics for this paper

More papers in Post-Print from HAL
Bibliographic data for series maintained by CCSD ().