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Is the event study methodology useful for merger analysis? A comparison of stock market and accounting data

Duso, Tomaso and Gugler, Klaus and Yurtoglu, Burcin B. (2010) Is the event study methodology useful for merger analysis? A comparison of stock market and accounting data. International Review of Law and Economics, 30 (2). 186 - 192. ISSN 0144-8188

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Abstract

This paper presents empirical evidence about the ability of event studies to capture mergers' ex-post profitability as measured by accounting data. We use a sample of large horizontal concentrations during the period 1990-2002 involving 482 firms either as merging firms or competitors, and contrast a measure of the mergers' profitability based on stock market event studies with one based on balance sheet profit data. We show that using a long window around the announcement date (25 or 50 days before the event) increases the ability to capture the ex-post merger effect: the pairwise correlation coefficient is positive and highly significant.

Item Type: Article
Additional Information: To see the final version of this paper please visit the publisher's website. Access to the published version may require a subscription.
Keywords: Mergers / Merger control / event studies / ex-post evaluation
Classification Codes: JEL L4, K21, G34
Divisions: Departments > Volkswirtschaft > Quantitative Volkswirtschaftslehre
Version of the Document: Accepted for Publication
Variance from Published Version: Minor
Depositing User: Dissertation Administrator
Date Deposited: 24 Mar 2011 13:11
Last Modified: 15 Sep 2017 22:10
Related URLs:
FIDES Link: https://bach.wu.ac.at/d/research/results/52729/
URI: http://epub.wu.ac.at/id/eprint/3026

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