A Note on Merger and Acquisition Evaluation
WIFO Working Papers, No. 462
8 Pages Posted: 20 Feb 2014
Date Written: February 17, 2014
This note proposes the continuous treatment approach as a valuable alternative to propensity score matching for evaluating economic effects of merger and acquisitions (M&As). This framework allows to consider the variation in treatment intensities explicitly, and it does not call for the definition of cut-off values in traded ownership shares in order to construct a binary treatment indicator. We demonstrate the usefulness of this approach using data from European M&As and by relying on the example of post-M&A employment effects.
Keywords: Merger and acquisition evaluation, continuous treatment models, generalized propensity score matching, employment effects
JEL Classification: C21, G34, L25
Suggested Citation: Suggested Citation