Managerial Behavior, Takeovers and Employment Duration

Conference paper: This paper uses a unique data set of linked employer-employee data in which asset transfers between firms can be identified to study the manner in which employment policy changes in the aftermath of a merger or acquisition (M&A). Using parametric duration models with unobserved heterogeneity, it appears that the employment policy of the firm changes radically after an M&A with respect to the “steady state”. Not only do various observed characteristics impact the probability of continued employment in a different manner after an M&A, but the distribution of unobserved characteristics that affect employment changes – reflecting differences in the stock of previous employees and the flow of new hires – as does the impact of this heterogeneity on employment durations.

Author(s)

David Margolis

Date of publication
  • 2008
Keywords
  • Managerial Behavior
  • Employment duration
  • Mergers and Acquisitions
  • Linked Employer-Employee Data
Title of the congress
  • Econometric Society European Meetings
Version
  • 1