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The Dynamic Impacts of M&A on Employment in Japan : Using Micro-data from the Financial Statements Statistics of Corporations by Industry

Author

Listed:
  • Hiroyuki Taguchi

    (Policy Research Institute)

  • Taichi Yanagawa
  • Masashi Harita

Abstract

This paper provides empirical evidence on the effects of mergers and acquisitions (M&A) on employment in Japan. It contributes to the literature by capturing dynamic employment impacts of various types of M&A using the latest micro data of firms financial statements. Our main findings are : the dynamic effect of firm acquisitions on a target firms employment proved to be significantly positive mainly in the manufacturing sector, while the dynamic effect of mergers on a remaining firms employment turned out to be significantly negative mainly in the non-manufacturing sector. The switching pattern from negative impact to positive impact on a target firms employment in the dynamic post-acquisition process appeared more clearly in the domestic acquisition case than in the cross-border acquisition case for the manufacturing sector. We speculate that the dynamic positive employment effect of firm acquisitions reflects the efficiency gains by a firms management improvements in the post-acquisition process, whereas the dynamic negative employment effect of mergers implies organizational rationalization in the post-merger process.

Suggested Citation

  • Hiroyuki Taguchi & Taichi Yanagawa & Masashi Harita, 2010. "The Dynamic Impacts of M&A on Employment in Japan : Using Micro-data from the Financial Statements Statistics of Corporations by Industry," Microeconomics Working Papers 23114, East Asian Bureau of Economic Research.
    • Handle: RePEc:eab:microe:23114
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    References listed on IDEAS

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    Cited by:

    1. Hiroyuki Taguchi & Taichi Yanagawa & Masashi Harita, 2012. "Impact of M&A on the Employment in Japanese Companies," Public Policy Review, Policy Research Institute, Ministry of Finance Japan, vol. 8(5), pages 581-608, November.

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    More about this item

    Keywords

    M&A; firm acquisitions; mergers; dynamic employment effects;
    All these keywords.

    JEL classification:

    • D21 - Microeconomics - - Production and Organizations - - - Firm Behavior: Theory
    • M51 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics - - - Firm Employment Decisions; Promotions

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