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The Wage and Employment Consequences of Ownership Change


  • Kevin Amess
  • Sourafel Girma
  • Mike Wright


This paper provides a comparative examination of the consequences of leveraged buyouts (LBOs) and corporate takeovers on employment growth and wage growth. Employing both difference‐in‐differences combined with propensity score matching and the control function approach, we find evidence that (i) wages remain unchanged after either a private equity (PE)‐backed or non‐PE‐backed LBO, (ii) wages remain unchanged after an unrelated takeover and (iii) related takeovers have negative employment consequences, possibly because of rationalisation. Our evidence does not find strong support for intervention in the market for corporate control on the grounds of protecting employees' welfare. Copyright © 2013 The Authors. Managerial and Decision Economics published by John Wiley & Sons, Ltd.

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  • Kevin Amess & Sourafel Girma & Mike Wright, 2014. "The Wage and Employment Consequences of Ownership Change," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 35(2), pages 161-171, March.
  • Handle: RePEc:wly:mgtdec:v:35:y:2014:i:2:p:161-171

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    Cited by:

    1. Margarita Carvalho & João Cerejeira, 2019. "Mergers and Acquisitions and wage effects in the Portuguese banking sector," NIPE Working Papers 07/2019, NIPE - Universidade do Minho.
    2. Blind, Georg D. & Lottanti von Mandach, Stefania, 2021. "Private Equity Buyouts in Japan: Effects on Employment Numbers," Journal of the Japanese and International Economies, Elsevier, vol. 59(C).
    3. Lee, Kyeong Hun & Mauer, David C. & Xu, Emma Qianying, 2018. "Human capital relatedness and mergers and acquisitions," Journal of Financial Economics, Elsevier, vol. 129(1), pages 111-135.

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