IDEAS home Printed from https://ideas.repec.org/p/nbr/nberwo/3187.html
   My bibliography  Save this paper

Do Union Wealth Concessions Explain Takeover Premiums? The Evidence on Contract Wages

Author

Listed:
  • Joshua Rosett

Abstract

I estimate changes in levels of union real wage growth associated with corporate takeovers and accompanying chief executive officer changes. The effects are statistically insignificant. The results are used to construct union wealth changes associated with corporate control events. Target fire shareholder wealth premiums are estimated using a simple market model. The union and shareholder wealth changes are compared, and I conclude that transfers of wealth from unions to shareholders ate not an economically significant explanation of shareholder wealth premiums.

Suggested Citation

  • Joshua Rosett, 1989. "Do Union Wealth Concessions Explain Takeover Premiums? The Evidence on Contract Wages," NBER Working Papers 3187, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:3187
    Note: LS ME
    as

    Download full text from publisher

    File URL: http://www.nber.org/papers/w3187.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Bradley, Michael & Desai, Anand & Kim, E. Han, 1988. "Synergistic gains from corporate acquisitions and their division between the stockholders of target and acquiring firms," Journal of Financial Economics, Elsevier, vol. 21(1), pages 3-40, May.
    2. Henry G. Manne, 1965. "Mergers and the Market for Corporate Control," Journal of Political Economy, University of Chicago Press, vol. 73(2), pages 110-110.
    3. Jensen, Michael C. & Meckling, William H., 1976. "Theory of the firm: Managerial behavior, agency costs and ownership structure," Journal of Financial Economics, Elsevier, vol. 3(4), pages 305-360, October.
    4. Eckbo, B Espen & Wier, Peggy, 1985. "Antimerger Policy under the Hart-Scott-Rodino Act: A Reexamination of the Market Power Hypothesis," Journal of Law and Economics, University of Chicago Press, vol. 28(1), pages 119-149, April.
    5. Andrei Shleifer & Lawrence H. Summers, 1988. "Breach of Trust in Hostile Takeovers," NBER Chapters, in: Corporate Takeovers: Causes and Consequences, pages 33-68, National Bureau of Economic Research, Inc.
    6. Charles Brown & James L. Medoff, 1988. "The Impact of Firm Acquisitions on Labor," NBER Chapters, in: Corporate Takeovers: Causes and Consequences, pages 9-32, National Bureau of Economic Research, Inc.
    7. Lichtenberg, F.R. & Siegel, D., 1989. "The Effect Of Takeovers On The Employment And Wages Of Central-Office And Other Personnel," Papers fb-_89-05, Columbia - Graduate School of Business.
    8. Jensen, Michael C. & Ruback, Richard S., 1983. "The market for corporate control : The scientific evidence," Journal of Financial Economics, Elsevier, vol. 11(1-4), pages 5-50, April.
    9. Roll, Richard, 1986. "The Hubris Hypothesis of Corporate Takeovers," The Journal of Business, University of Chicago Press, vol. 59(2), pages 197-216, April.
    10. Abowd, John M, 1989. "The Effect of Wage Bargains on the Stock Market Value of the Firm," American Economic Review, American Economic Association, vol. 79(4), pages 774-800, September.
    11. Fama, Eugene F & Jensen, Michael C, 1983. "Separation of Ownership and Control," Journal of Law and Economics, University of Chicago Press, vol. 26(2), pages 301-325, June.
    12. Eckbo, B Espen, 1985. "Mergers and the Market Concentration Doctrine: Evidence from the Capital Market," The Journal of Business, University of Chicago Press, vol. 58(3), pages 325-349, July.
    13. Henry G. Manne, 1965. "Mergers and the Market for Corporate Control," Journal of Political Economy, University of Chicago Press, vol. 73(4), pages 351-351.
    14. repec:bla:jfinan:v:44:y:1989:i:3:p:611-32 is not listed on IDEAS
    15. Frank R. Lichtenberg & Donald Siegel, 1987. "Productivity and Changes in Ownership of Manufactoring Plants," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 18(3, Specia), pages 643-684.
    16. Ruback, Richard S., 1983. "Assessing competition in the market for corporate acquisitions," Journal of Financial Economics, Elsevier, vol. 11(1-4), pages 141-153, April.
    17. Peter Kennedy, 2003. "A Guide to Econometrics, 5th Edition," MIT Press Books, The MIT Press, edition 5, volume 1, number 026261183x, April.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Moerland, Pieter W., 1995. "Alternative disciplinary mechanisms in different corporate systems," Journal of Economic Behavior & Organization, Elsevier, vol. 26(1), pages 17-34, January.
    2. Shleifer, Andrei & Vishny, Robert W, 1997. "A Survey of Corporate Governance," Journal of Finance, American Finance Association, vol. 52(2), pages 737-783, June.
    3. Shams, Syed, 2021. "Competition in the acquisition market and returns to bidders in Australia," Research in International Business and Finance, Elsevier, vol. 55(C).
    4. Mike Burkart & Samuel Lee, 2008. "One Share - One Vote: the Theory," Review of Finance, European Finance Association, vol. 12(1), pages 1-49.
    5. Szilagyi, P.G., 2007. "Corporate governance and the agency costs of debt and outside equity," Other publications TiSEM 9520d40a-224f-43a8-9bf9-b, Tilburg University, School of Economics and Management.
    6. Radygin Alexandr & Entov Revold & Mejeraoups I., 2007. "External Mechanisms of Corporate Governance," Research Paper Series, Gaidar Institute for Economic Policy, issue 104P.
    7. Wenxia Ge & Jeong-Bon Kim, 2014. "Boards, takeover protection, and real earnings management," Review of Quantitative Finance and Accounting, Springer, vol. 43(4), pages 651-682, November.
    8. Rudolf Kerschbamer, 1998. "Disciplinary Takeovers and Industry Effects," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 7(2), pages 265-306, June.
    9. Matthias Kiefer & Edward Jones & Andrew Adams, 2016. "Principals, Agents and Incomplete Contracts: Are Surrender of Control and Renegotiation the Solution?," CFI Discussion Papers 1603, Centre for Finance and Investment, Heriot Watt University.
    10. David R Merrell, 1999. "Productivity And Acquisitions In U.S. Coal Mining," Working Papers 99-17, Center for Economic Studies, U.S. Census Bureau.
    11. Dennis Mueller, 1996. "Antimerger policy in the United States: History and lessons," Empirica, Springer;Austrian Institute for Economic Research;Austrian Economic Association, vol. 23(3), pages 229-253, October.
    12. Song, Moon H. & Walkling, Ralph A., 2005. "Anticipation, Acquisitions and Bidder Returns," Working Paper Series 2005-11, Ohio State University, Charles A. Dice Center for Research in Financial Economics.
    13. Luc Renneboog & Peter G. Szilagyi, 2008. "Corporate Restructuring and Bondholder Wealth," European Financial Management, European Financial Management Association, vol. 14(4), pages 792-819, September.
    14. Antonios Antoniou & Philippe Arbour & Huainan Zhao, 2008. "How Much Is Too Much: Are Merger Premiums Too High?," European Financial Management, European Financial Management Association, vol. 14(2), pages 268-287, March.
    15. David Gindis, 0. "On the origins, meaning and influence of Jensen and Meckling’s definition of the firm," Oxford Economic Papers, Oxford University Press, vol. 72(4), pages 966-984.
    16. Guernsey, Scott & Sepe, Simone M. & Serfling, Matthew, 2022. "Blood in the water: The value of antitakeover provisions during market shocks," Journal of Financial Economics, Elsevier, vol. 143(3), pages 1070-1096.
    17. Peter M Clarkson & Shams Pathan & Andrew Tellam, 2016. "Do private equity target firms exhibit less effectual governance structures?," Australian Journal of Management, Australian School of Business, vol. 41(2), pages 244-270, May.
    18. Levine, Ross, 2005. "Finance and Growth: Theory and Evidence," Handbook of Economic Growth, in: Philippe Aghion & Steven Durlauf (ed.), Handbook of Economic Growth, edition 1, volume 1, chapter 12, pages 865-934, Elsevier.
    19. Jeffrey M. Lacker & John A. Weinberg, 1990. "Takeovers and stock price volatility," Economic Review, Federal Reserve Bank of Richmond, vol. 76(Mar), pages 29-44.
    20. Elisabeth Dedman, 2003. "Executive turnover in UK firms: the impact of Cadbury," Accounting and Business Research, Taylor & Francis Journals, vol. 33(1), pages 33-50.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:nbr:nberwo:3187. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: the person in charge (email available below). General contact details of provider: https://edirc.repec.org/data/nberrus.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.