A Note on Merger and Acquisition Evaluation

WIFO Working Papers, No. 462

8 Pages Posted: 20 Feb 2014

See all articles by Benjamin Furlan

Benjamin Furlan

University of Salzburg - Department of Economics and Social Sciences

Harald Oberhofer

Vienna University of Economics and Business - Department of Economics; Austrian Institute of Economic Research (WIFO)

Hannes Winner

University of Salzburg - Department of Economics and Social Sciences; Austrian Institute of Economic Research (WIFO); University of Oxford - Oxford University Centre for Business Taxation; University of Innsbruck - Department of Economics & Statistics

Date Written: February 17, 2014

Abstract

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 e ffects

JEL Classification: C21, G34, L25

Suggested Citation

Furlan, Benjamin and Oberhofer, Harald and Winner, Hannes, A Note on Merger and Acquisition Evaluation (February 17, 2014). WIFO Working Papers, No. 462, Available at SSRN: https://ssrn.com/abstract=2398261 or http://dx.doi.org/10.2139/ssrn.2398261

Benjamin Furlan

University of Salzburg - Department of Economics and Social Sciences ( email )

Residenzplatz 9
Salzburg, 5010
Austria

HOME PAGE: http://www.uni-salzburg.at/sowi/furlan

Harald Oberhofer (Contact Author)

Vienna University of Economics and Business - Department of Economics ( email )

Welthandelsplatz 1
A-1020 Vienna
Austria

Austrian Institute of Economic Research (WIFO) ( email )

P.O. Box 91
Wien, A-1103
Austria

Hannes Winner

University of Salzburg - Department of Economics and Social Sciences ( email )

Residenzplatz9
Salzburg, 5010
Austria

Austrian Institute of Economic Research (WIFO) ( email )

P.O. Box 91
Wien, A-1103
Austria

University of Oxford - Oxford University Centre for Business Taxation ( email )

Saïd Business School
Park End Street
Oxford, OX1 1HP
United Kingdom

University of Innsbruck - Department of Economics & Statistics ( email )

Universitatsstrasse 15
Innsbruck, A-6020
Austria

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