Inventors? Response to Firm Acquisitions
AbstractMergers and acquisitions (M&As) constitute a disruption to the working environment of the inventive labor force of the acquired company. If inventors would respond with a decline of their patent productivity or departure from the firm this can be detrimental to the innovative process within the merged entity and can be contradictory to the aims of the firm acquisition. This paper provides empirical evidence on post-merger mobility and productivity of 673 inventors employed by European acquisition targets in the years 2000 and 2001. The empirical results show that 1.) the most productive and experienced individuals stay with the merged entity; 2.) inventors that left the acquired firm are less productive in post-merger years than those that stayed with the merged entity; 3.) M&As trigger inventor mobility, but do not lead to a decline in patent productivity if compared to a control group of inventors that have not been involved in a firm acquisition. --
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Bibliographic InfoPaper provided by ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research in its series ZEW Discussion Papers with number 07-078.
Date of creation: 2007
Date of revision:
M&As; inventor mobility and productivity;
Find related papers by JEL classification:
- G34 - Financial Economics - - Corporate Finance and Governance - - - Mergers; Acquisitions; Restructuring; Corporate Governance
- C24 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Truncated and Censored Models; Switching Regression Models
- O32 - Economic Development, Technological Change, and Growth - - Technological Change; Research and Development; Intellectual Property Rights - - - Management of Technological Innovation and R&D
This paper has been announced in the following NEP Reports:
- NEP-ALL-2008-02-02 (All new papers)
- NEP-COM-2008-02-02 (Industrial Competition)
- NEP-INO-2008-02-02 (Innovation)
- NEP-IPR-2008-02-02 (Intellectual Property Rights)
- NEP-TID-2008-02-02 (Technology & Industrial Dynamics)
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