Mergers and Acquisitions, Technological Change and Inequality

64 Pages Posted: 13 Jun 2016 Last revised: 4 Nov 2018

See all articles by Wenting Ma

Wenting Ma

University of North Carolina at Chapel Hill

Paige Ouimet

University of North Carolina at Chapel Hill

Elena Simintzi

University of North Carolina Kenan-Flagler Business School; Centre for Economic Policy Research (CEPR)

Date Written: October 17, 2018

Abstract

We document shifts in occupational composition following mergers and acquisitions (M&As) along with increases in average wages and wage inequality. We propose M&As act as a catalyst for technological change. Due to an increase in scale, improved efficiency and lower financial constraints, M&As facilitate technology adoption, disproportionately increasing the productivity of high-skill workers and enabling the displacement of mid-income routine occupations. We document these findings in M&A impacted establishments as compared to a matched sample of control establishments. These results generalize within industries, suggesting M&A activity is an important driver of economy-wide trends in job polarization and income inequality.

Keywords: mergers, technological change, inequality

JEL Classification: G34, J2, J21, J31, D31

Suggested Citation

Ma, Wenting and Ouimet, Paige and Simintzi, Elena, Mergers and Acquisitions, Technological Change and Inequality (October 17, 2018). European Corporate Governance Institute (ECGI) - Finance Working Paper No. 485/2016. Available at SSRN: https://ssrn.com/abstract=2793887 or http://dx.doi.org/10.2139/ssrn.2793887

Wenting Ma

University of North Carolina at Chapel Hill ( email )

CB 3305, Gardner Hall
Chapel Hill, NC NC 27514
United States

HOME PAGE: http://econ.unc.edu/grads/wenting-ma/

Paige Ouimet (Contact Author)

University of North Carolina at Chapel Hill ( email )

McColl Building
Chapel Hill, NC 27599-3490
United States

Elena Simintzi

University of North Carolina Kenan-Flagler Business School ( email )

McColl Building, Room 4200B
300 Kenan Center Drive
Chapel Hill, NC 27599-3490
United States

Centre for Economic Policy Research (CEPR) ( email )

London
United Kingdom

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